[Interim Results](index=1&type=section&id=%E4%B8%AD%E6%9C%9F%E6%A5%AD%E7%B8%BE) [Financial Highlights](index=1&type=section&id=%E8%B2%A1%E5%8B%99%E6%91%98%E8%A6%81) During the reporting period, the Company turned from profit to loss, with revenue decreasing year-on-year by 11.2%, a net loss of **RMB 141.8 million**, and basic loss per share of **RMB 6.84 cents** Financial Highlights | | 2025 RMB thousands | 2024 RMB thousands | | :--- | :--- | :--- | | Revenue | 640,165 | 720,643 | | Gross Profit | 381,867 | 419,946 | | (Loss) / Profit Before Income Tax | (134,713) | 68,897 | | (Loss) / Profit for the Period | (141,800) | 52,594 | | (Loss) / Profit for the Period Attributable to Owners of the Company | (141,978) | 52,414 | | Basic (Loss) / Earnings Per Share (RMB cents) | (6.84) | 2.52 | - The Company turned from profit in the same period last year to a loss, primarily due to decreased revenue and impairment provision for trade debts[4](index=4&type=chunk)[44](index=44&type=chunk) [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=2&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%90%8D%E7%9B%8A%E5%8F%8A%E5%85%B6%E4%BB%96%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) For the six months ended 30 June 2025, the Company's revenue decreased year-on-year by 11.2% to **RMB 640.2 million**, gross profit decreased by 9.0% to **RMB 381.9 million**, and the period turned from a profit of **RMB 52.6 million** in the same period last year to a loss of **RMB 141.8 million**, mainly due to impairment provision for trade debts Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income | | 2025 RMB thousands | 2024 RMB thousands | | :--- | :--- | :--- | | Revenue | 640,165 | 720,643 | | Cost of Sales | (258,298) | (300,697) | | Gross Profit | 381,867 | 419,946 | | Other Income and Other Gains and Losses | (124,452) | 55,549 | | Distribution and Selling Expenses | (330,159) | (346,574) | | Administrative and General Expenses | (61,530) | (59,512) | | Finance Costs | (439) | (512) | | (Loss) / Profit Before Income Tax | (134,713) | 68,897 | | Income Tax Expense | (7,087) | (16,303) | | (Loss) / Profit for the Period | (141,800) | 52,594 | | (Loss) / Profit for the Period Attributable to Owners of the Company | (141,978) | 52,414 | | Total Comprehensive (Expense) / Income for the Period | (149,379) | 44,217 | - Loss for the period is mainly attributable to an impairment provision of **RMB 149.05 million** for trade debts due from former subsidiary Nanjing Meilihua[21](index=21&type=chunk)[44](index=44&type=chunk) [Condensed Consolidated Statement of Financial Position](index=4&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) As at 30 June 2025, the Company's total assets were **RMB 1,332.6 million**, a decrease from **RMB 1,481.1 million** at 2024 year-end, with net current assets decreasing by **21.8%** to **RMB 672.8 million** Condensed Consolidated Statement of Financial Position | | 30 June 2025 RMB thousands | 31 December 2024 RMB thousands | | :--- | :--- | :--- | | **Non-current Assets** | | | | Property, Plant and Equipment | 178,684 | 181,449 | | Right-of-use Assets | 65,957 | 73,638 | | Other Intangible Assets | 3,338 | 5,644 | | Goodwill | 5,725 | 5,725 | | Equity Investments at Fair Value Through Other Comprehensive Income | 6,754 | 18,300 | | Deferred Tax Assets | 30,967 | 31,226 | | Long-term Deposits, Other Receivables and Prepayments | 76,667 | 16,225 | | **Current Assets** | | | | Inventories | 304,922 | 302,587 | | Trade Receivables | 142,414 | 159,057 | | Other Receivables and Prepayments | 33,420 | 257,264 | | Bank Balances and Cash | 483,405 | 429,748 | | **Current Liabilities** | | | | Trade Payables | 122,424 | 106,443 | | Other Payables | 96,496 | 107,697 | | Contract Liabilities | 32,628 | 36,065 | | Lease Liabilities | 8,825 | 12,221 | | Current Tax Liabilities | 31,329 | 26,518 | | **Non-current Liabilities** | | | | Lease Liabilities | 5,283 | 7,152 | | **Total Equity** | 1,035,590 | 1,184,969 | - Net current assets decreased year-on-year by **RMB 187.1 million**, primarily due to a significant decrease in other receivables and prepayments[30](index=30&type=chunk)[82](index=82&type=chunk) [Condensed Consolidated Statement of Changes in Equity](index=6&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%AC%8A%E7%9B%8A%E8%AE%8A%E5%8B%95%E8%A1%A8) As at 30 June 2025, total equity attributable to owners of the Company was **RMB 1,026.1 million**, a decrease from **RMB 1,175.7 million** at 2024 year-end, mainly due to a total comprehensive expense of **RMB 149.6 million** for the period Condensed Consolidated Statement of Changes in Equity | | Share Capital RMB thousands | Share Premium RMB thousands | Statutory Reserve RMB thousands | Reserve for Equity Investments at Fair Value Through Other Comprehensive Income RMB thousands | Contributed Surplus RMB thousands | Retained Profits RMB thousands | Equity Attributable to Owners of the Company RMB thousands | Non-controlling Interests RMB thousands | Total Equity RMB thousands | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Balance at 1 January 2024 (Audited) | 209,097 | 646,042 | 180,653 | 1,556 | – | 345,285 | 1,382,633 | 9,237 | 1,391,870 | | Total Comprehensive (Expense) / Income for the Period (Unaudited) | – | – | – | (8,377) | – | 52,414 | 44,037 | 180 | 44,217 | | Cancellation of Share Premium (Unaudited) | – | (646,042) | – | – | 646,042 | – | – | – | – | | Special Dividend (Unaudited) | – | – | – | – | (65,056) | (185,948) | (251,004) | – | (251,004) | | Transfer (Unaudited) | – | – | 4,432 | – | – | (4,432) | – | – | – | | At 30 June 2024 (Unaudited) | 209,097 | – | 185,085 | (6,821) | 580,986 | 207,319 | 1,175,666 | 9,417 | 1,185,083 | | Balance at 1 January 2025 (Audited) | 209,097 | – | 188,255 | (8,051) | 589,867 | 196,518 | 1,175,686 | 9,283 | 1,184,969 | | Total Comprehensive (Expense) / Income for the Period (Unaudited) | – | – | – | (7,579) | – | (141,978) | (149,557) | 178 | (149,379) | | Transfer (Unaudited) | – | – | 2,218 | – | – | (2,218) | – | – | – | | At 30 June 2025 (Unaudited) | 209,097 | – | 190,473 | (15,630) | 589,867 | 52,322 | 1,026,129 | 9,461 | 1,035,590 | - On 27 June 2024, the Company approved the cancellation of share premium of **RMB 646.042 million**, which was transferred to contributed surplus[11](index=11&type=chunk) [Notes to the Condensed Consolidated Financial Statements](index=7&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8%E9%99%84%E8%A8%BB) This chapter details the basis of preparation, accounting policies, operating segment information, revenue and expense breakdowns, dividend policy, and the composition and changes of major asset and liability items, particularly disclosing the impairment provision and settlement for trade debts due from former subsidiary Nanjing Meilihua [1. General Information](index=7&type=section&id=1.%20%E4%B8%80%E8%88%AC%E8%B3%87%E6%96%99) The Company was incorporated in Bermuda and is primarily engaged in the manufacturing and sales of branded fashion footwear and toy retail business, with its shares listed on the Main Board of HKEX - The Company is an investment holding company, and its subsidiaries are primarily engaged in the manufacturing and sales of branded fashion footwear and toy retail[13](index=13&type=chunk) - The Company's shares are listed on the Main Board of HKEX[13](index=13&type=chunk) [2. Basis of Preparation](index=7&type=section&id=2.%20%E7%B7%A8%E8%A3%BD%E5%9F%BA%E7%A4%8E) The condensed consolidated financial statements are prepared in accordance with International Accounting Standard 34 and the Listing Rules of the Stock Exchange, with accounting policies consistent with the 2024 annual financial statements - Financial statements are prepared in accordance with International Accounting Standard 34 and the Listing Rules of the Stock Exchange[15](index=15&type=chunk) [3. Adoption of New and Revised International Financial Reporting Standards](index=7&type=section&id=3.%20%E6%8E%A1%E7%B4%8D%E6%96%B0%E8%A8%82%E5%8F%8A%E7%B6%93%E4%BF%AE%E8%A8%82%E5%9C%8B%E9%9A%9B%E8%B2%A1%E5%8B%99%E5%A0%B1%E5%91%8A%E6%BA%96%E5%89%87%E6%9C%83%E8%A8%88%E6%BA%96%E5%89%87) The Group has adopted all new and revised International Financial Reporting Standards effective from 1 January 2025, which did not result in significant changes to accounting policies or financial statement amounts - Adoption of new and revised IFRSs did not result in significant changes to accounting policies or financial statement amounts[16](index=16&type=chunk) [4. Operating Segment Information](index=8&type=section&id=4.%20%E7%B6%93%E7%87%9F%E5%88%86%E9%83%A8%E8%B3%87%E6%96%99) The Company primarily operates three segments: retail and wholesale footwear, contract manufacturing footwear, and toy retail; retail and wholesale footwear remains the primary revenue source but segment results significantly decreased; contract manufacturing footwear revenue and results both significantly declined; toy retail revenue increased Segment Revenue | | 2025 RMB thousands | 2024 RMB thousands | | :--- | :--- | :--- | | Retail and Wholesale Footwear－External Sales | 566,406 | 612,389 | | Contract Manufacturing Footwear－External Sales | 28,989 | 72,398 | | Toy Retail－External Sales | 44,770 | 35,856 | | Total Segment Revenue | 640,165 | 720,653 | Segment Results | | 2025 RMB thousands | 2024 RMB thousands | | :--- | :--- | :--- | | Retail and Wholesale Footwear | 21,146 | 71,646 | | Contract Manufacturing Footwear | (6,893) | (726) | | Toy Retail | 184 | 329 | | Total Segment Results | 14,437 | 71,249 | Segment Assets and Liabilities | | 30 June 2025 RMB thousands | 31 December 2024 RMB thousands | | :--- | :--- | :--- | | Total Segment Assets | 1,999,419 | 2,151,684 | | Total Consolidated Assets | 1,332,575 | 1,481,065 | | Total Segment Liabilities | 970,955 | 990,264 | | Total Consolidated Liabilities | 296,985 | 296,096 | [5. Revenue](index=9&type=section&id=5.%20%E6%94%B6%20%E7%9B%8A) For the six months ended 30 June 2025, total revenue was **RMB 640.2 million**, a year-on-year decrease of 11.2%; of which, retail and wholesale footwear contributed **88.5%** of the revenue, contract manufacturing footwear and toy retail contributed **4.5%** and **7.0%** respectively, with China market being the main source of revenue Revenue by Business Segment | | 2025 RMB thousands | 2024 RMB thousands | | :--- | :--- | :--- | | Retail and Wholesale Footwear | 566,406 | 612,389 | | Contract Manufacturing Footwear | 28,989 | 72,398 | | Toy Retail | 44,770 | 35,856 | | Total Revenue | 640,165 | 720,643 | Revenue by Geographical Market | | 2025 RMB thousands | 2024 RMB thousands | | :--- | :--- | :--- | | People's Republic of China | 612,972 | 649,276 | | United States of America | 27,193 | 71,367 | | Total | 640,165 | 720,643 | - Revenue recognition point is at a point in time[21](index=21&type=chunk) [6. Other Income and Other Gains and Losses](index=10&type=section&id=6.%20%E5%85%B6%E4%BB%96%E6%94%B6%E5%85%A5%E4%BB%A5%E5%8F%8A%E5%85%B6%E4%BB%96%E6%94%B6%E7%9B%8A%E5%8F%8A%E虧%E6%90%8D) Other income and other gains and losses for the period recorded a loss of **RMB 124.5 million**, primarily due to an impairment provision of **RMB 149.05 million** for trade debts due from former subsidiary Nanjing Meilihua Other Income and Other Gains and Losses | | 2025 RMB thousands | 2024 RMB thousands | | :--- | :--- | :--- | | Government Grants | 7,697 | 33,383 | | Interest Income from Bank Deposits | 3,008 | 6,155 | | Royalty Income | 8,111 | 10,169 | | Net Exchange Gains / (Losses) | 339 | (1,840) | | Impairment Provision for Trade Receivables | (1,345) | (113) | | Impairment Provision for Trade Debts | (149,050) | – | | Total Other Income and Other Gains and Losses | (124,452) | 55,549 | - Impairment provision for trade debts was **RMB (149,050) thousands**, which is the main component of other gains and losses for the period[21](index=21&type=chunk) [7. Finance Costs](index=11&type=section&id=7.%20%E8%B2%A1%E5%8B%99%E6%88%90%E6%9C%AC) Finance costs primarily consist of interest on leases, which was **RMB 0.4 million** for the current period, largely consistent with the same period last year Finance Costs | | 2025 RMB thousands | 2024 RMB thousands | | :--- | :--- | :--- | | Interest on Lease Liabilities | 439 | 512 | [8. Income Tax Expense](index=11&type=section&id=8.%20%E6%89%80%E5%BE%97%E7%A8%85%E9%96%8B%E6%94%AF) Income tax expense decreased year-on-year by **56.4%** to **RMB 7.1 million**, primarily due to a decrease in profit before tax; China Corporate Income Tax is calculated at a **25%** tax rate, there are no assessable profits in Hong Kong, and dividend withholding tax rate is **5%** or **10%** depending on the recipient's region Income Tax Expense | | 2025 RMB thousands | 2024 RMB thousands | | :--- | :--- | :--- | | Current Tax - China Corporate Income Tax | 4,673 | 11,793 | | Current Tax - China Withholding Tax | 2,156 | – | | Deferred Tax | 258 | 4,510 | | Income Tax Expense | 7,087 | 16,303 | - China Corporate Income Tax is calculated at a **25%** tax rate[23](index=23&type=chunk) - Chinese subsidiaries distributing dividends to non-Chinese tax resident entities are subject to a **5%** or **10%** withholding tax[24](index=24&type=chunk) [9. Dividends](index=12&type=section&id=9.%20%E8%82%A1%20%E6%81%AF) The Board did not recommend the payment of an interim dividend for the first half of 2025; a special dividend of **HKD 0.13** per share, totaling **RMB 251.0 million**, was distributed in the first half of 2024 Dividends | | 2025 RMB thousands | 2024 RMB thousands | | :--- | :--- | :--- | | Special dividend per ordinary share of HKD nil (2024: HKD 0.13) approved | – | 251,004 | - The Board did not recommend the payment of an interim dividend for the first half of 2025[25](index=25&type=chunk)[90](index=90&type=chunk) [10. (Loss) / Earnings Per Share](index=12&type=section&id=10.%20%E6%AF%8F%E8%82%A1%EF%BC%88%E虧%E6%90%8D%EF%BC%89%E2%88%95%E7%9B%88%E5%88%A9) Basic and diluted loss per share for the period were both **RMB 6.84 cents**, compared to earnings per share of **RMB 2.52 cents** in the same period last year; there were no potential dilutive ordinary shares during the period (Loss) / Earnings Per Share | | 2025 RMB cents | 2024 RMB cents | | :--- | :--- | :--- | | - Basic | (6.84) | 2.52 | | - Diluted | (6.84) | 2.52 | - Basic (loss) / earnings per share is calculated based on the loss for the period attributable to owners of the Company of approximately **RMB 141.978 million** and the weighted average number of ordinary shares of **2,077,000,000 shares**[26](index=26&type=chunk) [11. Trade Receivables](index=12&type=section&id=11.%20%E8%B2%A1%E5%8B%99%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85) As at 30 June 2025, net trade receivables were **RMB 142.4 million**, a decrease from **RMB 159.1 million** at 2024 year-end; the credit period generally ranges from **30 to 90 days** Trade Receivables | | 30 June 2025 RMB thousands | 31 December 2024 RMB thousands | | :--- | :--- | :--- | | Trade Receivables | 144,133 | 159,431 | | Provision for Loss | (1,719) | (374) | | Total | 142,414 | 159,057 | Ageing Analysis of Trade Receivables | | 30 June 2025 RMB thousands | 31 December 2024 RMB thousands | | :--- | :--- | :--- | | 0 to 60 days | 129,235 | 138,020 | | 61 to 180 days | 10,418 | 17,094 | | 181 days to 1 year | 321 | 2,411 | | Over 1 year | 2,440 | 1,532 | | Total | 142,414 | 159,057 | - The credit period generally ranges from **30 to 90 days**, and the Company maintains strict control over uncollected receivables[28](index=28&type=chunk) [12. Other Receivables and Prepayments](index=13&type=section&id=12.%20%E5%85%B6%E4%BB%96%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85%E5%8F%8A%E9%A0%90%E4%BB%98%E6%AC%BE%E9%A0%85) Total other receivables and prepayments were **RMB 110.1 million**, a significant decrease from **RMB 273.5 million** at 2024 year-end; of which, trade debts due from former subsidiary Nanjing Meilihua were settled through civil mediation, resulting in an impairment loss of **RMB 149.05 million** recognized in the current period Other Receivables and Prepayments | | 30 June 2025 RMB thousands | 31 December 2024 RMB thousands | | :--- | :--- | :--- | | **Non-current Assets** | | | | Long-term Deposits | 13,754 | 14,310 | | Prepayments | 1,761 | 1,915 | | Trade Debts Due from a Former Subsidiary | 61,152 | – | | **Current Assets** | | | | Prepayments | 12,576 | 12,991 | | Trade Debts Due from a Former Subsidiary | 4,000 | 214,207 | | VAT Recoverable | 1,233 | 10,725 | | Interest Receivable | 360 | 189 | | Others | 15,251 | 19,152 | | Total | 110,087 | 273,489 | - Trade debts due from Nanjing Meilihua were settled through civil mediation, with **RMB 65.152 million** to be repaid in regular installments from October 2025 to March 2045[33](index=33&type=chunk) - The settlement with Nanjing Meilihua resulted in a total impairment loss of approximately **RMB 149.050 million**, recognized in the current period[34](index=34&type=chunk) [13. Trade Payables](index=15&type=section&id=13.%20%E8%B2%A1%E5%8B%99%E6%87%89%E4%BB%98%E6%AC%BE%E9%A0%85) As at 30 June 2025, trade payables were **RMB 122.4 million**, an increase from **RMB 106.4 million** at 2024 year-end Trade Payables | | 30 June 2025 RMB thousands | 31 December 2024 RMB thousands | | :--- | :--- | :--- | | Trade Payables | 122,424 | 106,443 | Ageing Analysis of Trade Payables | | 30 June 2025 RMB thousands | 31 December 2024 RMB thousands | | :--- | :--- | :--- | | 0 to 90 days | 116,846 | 101,556 | | 91 to 180 days | 667 | 486 | | 181 days to 1 year | 726 | 225 | | Over 1 year | 4,185 | 4,176 | | Total | 122,424 | 106,443 | [Management Discussion and Analysis](index=16&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) [Business Review](index=16&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7) In H1 2025, the global economy faced downside risks, and China's economy recovered amidst challenges; the Company firmly executed its strategic transformation, focusing on core business enhancement, omnichannel experience optimization, and continuous operational improvement to address challenges [Macroeconomic Environment](index=16&type=section&id=%E5%AE%8F%E8%A7%80%E7%B6%93%E6%BF%9F%E7%92%B0%E5%A2%83) The global economy is affected by geopolitical conflicts and trade protectionism, with the World Bank lowering its 2025 global economic growth forecast to **2.3%**; China's economy is expected to slow to **4.5%**, but H1 GDP grew **5.3%** year-on-year, and the consumption market shows a strong recovery trend - World Bank lowered 2025 global economic growth forecast to **2.3%**, primarily due to US tariff measures[37](index=37&type=chunk) - World Bank forecasts China's economy to slow to **4.5%** in 2025 and further to **4.0%** in 2026[38](index=38&type=chunk) - China's H1 2025 GDP grew **5.3%** year-on-year, and total retail sales of consumer goods grew **5.0%** year-on-year[39](index=39&type=chunk)[40](index=40&type=chunk) [Company Strategy and Response](index=17&type=section&id=%E5%85%AC%E5%8F%B8%E6%88%B0%E7%95%A5%E8%88%87%E6%87%89%E5%B0%8D) The Company firmly executes its strategic transformation, focusing on core business enhancement, omnichannel experience optimization, and continuous operational improvement to address global economic slowdown challenges, and plans to continue focusing on footwear as its core business to enhance market competitiveness - The Company firmly executes its strategic transformation, focusing on core business enhancement, omnichannel experience optimization, and continuous operational improvement[42](index=42&type=chunk) - The Group will continue to focus on footwear as its core business, steadily enhance its market competitiveness, and simultaneously optimize its operations and management systems[42](index=42&type=chunk) [Operational Performance](index=17&type=section&id=%E7%87%9F%E9%81%8B%E8%A1%A8%E7%8F%BE) During the reporting period, the Company's total revenue decreased year-on-year by **11.2%** to **RMB 640.2 million**, with a loss for the period of **RMB 141.8 million**; total retail stores net decreased by **47 stores**, and the Company continues to optimize its retail network, enhance single-store efficiency, optimize inventory and supply chain, actively deploy multi-brand and full-category products, and increase marketing efforts on social media [Retail Network Optimization](index=18&type=section&id=%E9%9B%B6%E5%94%AE%E7%B6%B2%E7%B5%A1%E5%84%AA%E5%8C%96) The Company continues to optimize its retail network, closing underperforming stores and retaining efficient stores in core business districts to enhance single-store operational efficiency and overall profitability; it will strategically close department store outlets in the future, while maintaining stable numbers of outlet and shopping mall stores Geographical Distribution of Footwear Retail Stores (As at 30 June 2025) | Sales Region | C.banner Self-operated Retail Stores | C.banner Third-party Retail Stores | EBLAN Self-operated Retail Stores | EBLAN Third-party Retail Stores | MIO Self-operated Retail Stores | MIO Third-party Retail Stores | Nairan Self-operated Retail Stores | Nairan Third-party Retail Stores | Total | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Northeast China | 74 | 13 | 16 | – | 11 | 12 | 1 | – | 127 | | North China | 87 | 69 | 13 | – | 12 | 26 | 5 | – | 212 | | East China | 159 | 27 | 33 | – | 53 | 3 | 31 | 1 | 307 | | Shanghai | 63 | – | – | – | 9 | – | 9 | – | 81 | | South China | 85 | 6 | – | – | 10 | – | 1 | – | 102 | | Western China | 96 | 16 | 2 | 1 | 17 | 4 | 3 | – | 139 | | Total | 564 | 131 | 64 | 1 | 112 | 45 | 50 | 1 | 968 | - The Company continues to implement the core strategy of "optimizing channel structure and improving single-store performance" to strengthen offline retail network operational efficiency[46](index=46&type=chunk) - In the second half of the year, underperforming department store outlets will be strategically closed, while the number of outlet and shopping mall stores will remain largely stable[46](index=46&type=chunk) [Single-Store Efficiency Improvement and Inventory Optimization](index=19&type=section&id=%E5%96%AE%E5%BA%97%E6%95%88%E7%8E%87%E6%8F%90%E5%8D%87%E5%8F%8A%E5%BA%AB%E5%AD%98%E5%84%AA%E5%8C%96) The Company optimizes product portfolio, promotional strategies, and staffing through data analysis to enhance same-store sales growth; simultaneously, it strictly controls initial order quantities, adopts smart replenishment systems, shortens production and replenishment cycles, and improves supply chain efficiency - The Group continues to strengthen refined management of single stores, optimizing product portfolio, promotional strategies, and staffing through data analysis[49](index=49&type=chunk) - Strictly controls initial order quantities to reduce inventory backlog risks, and introduces smart forecasting systems and real-time sales data analysis to achieve replenishment within **7 to 15 days**[50](index=50&type=chunk)[51](index=51&type=chunk) [Multi-Brand Matrix and Product Strategy](index=20&type=section&id=%E5%A4%9A%E5%85%83%E5%93%81%E7%89%8C%E7%9F%A9%E9%99%A3%E5%8F%8A%E7%94%A2%E5%93%81%E7%AD%96%E7%95%A5) The Company owns multiple proprietary brands such as "C.banner", "EBLAN", "MIO", and "Nairan", and through a "blockbuster product strategy" and AI design platform, has shortened product development cycles by **40%**, increased product sales by **35%**, and plans to expand scenario-based product lines and increase the use of eco-friendly materials - The Company owns multiple proprietary brands such as "C.banner", "EBLAN", "MIO", and "Nairan" to meet diverse consumer needs[52](index=52&type=chunk) - Introducing an AI design platform, new product development cycle shortened by **40%**, product sales increased by **35%**, and 3D digital sample technology reduced cost waste by **60%**[54](index=54&type=chunk) - Plans to establish a "classic + limited edition" dual-track product matrix, deepen sustainable fashion initiatives, and increase the use of eco-friendly materials to **50%** in H2 2025[55](index=55&type=chunk) [Comfort and Unique Design](index=21&type=section&id=%E8%88%92%E9%81%A9%E6%80%A7%E8%88%87%E7%8D%A8%E7%89%B9%E6%80%A7%E8%A8%AD%E8%A8%88) Facing the shift in China's footwear market from "aesthetics first" to "comfort first", the Company continues to invest in R&D for athletic and casual footwear, and upgraded silent shoe technology to its fifth generation, with sales accounting for approximately **20%** of total sales - China's footwear market is undergoing a shift in consumer philosophy from "aesthetics first" to "comfort first", with functional footwear becoming mainstream[56](index=56&type=chunk) - C.banner's silent shoe technology has iterated to the fifth generation, with sales accounting for approximately **20%** of total sales[57](index=57&type=chunk) [Creating the "Family Shoe Store" Concept](index=21&type=section&id=%E6%89%93%E9%80%A0%E3%80%8C%E4%B8%80%E5%AE%B6%E5%A4%A7%E5%B0%8F%E7%9A%84%E9%9E%8B%E5%BA%97%E3%80%8D%E6%A6%82%E5%BF%B5) The Company launched the "Family Shoe Store" concept, offering a one-stop shopping experience for men's, women's, and children's shoes, combined with European architectural style design, children's zones, and book exchange activities to enhance customer experience - Launched the "Family Shoe Store" concept, offering one-stop shopping for men's, women's, and children's shoes[58](index=58&type=chunk) - Stores feature European architectural style design, with children's zones and book exchange activities, aiming to create a warm and pleasant retail experience[59](index=59&type=chunk) [Decentralized Channels and Refined Operations](index=22&type=section&id=%E6%B8%A0%E9%81%93%E5%8E%BB%E4%B8%AD%E5%BF%83%E5%8C%96%E5%8F%8A%E7%B2%BE%E7%B4%B0%E5%8C%96%E7%87%9F%E9%81%8B) The Company has **968 offline stores** in China, with main sales channels including department stores, outlets, shopping malls, and online e-commerce; it will prioritize expanding in the China market in the future, deepening its presence through refined operations - The Company currently has **968 offline stores** in China, of which **790** are self-operated stores[60](index=60&type=chunk) - Will continue to prioritize expanding in the China market in the future, deepening its presence through refined operations to explore more business opportunities[61](index=61&type=chunk) [Enhancing Competitiveness and Achieving Sustainable Development](index=22&type=section&id=%E6%8F%90%E9%AB%98%E7%AB%B6%E7%88%AD%E5%8A%9B%E4%B8%A6%E5%AF%A6%E7%8F%BE%E5%8F%AF%E6%8C%81%E7%BA%8C%E7%99%BC%E5%B1%95) Xuzhou C.banner Footwear Co., Ltd. is undergoing industrial upgrading, exploring European and American orders, and implementing a dual market strategy to provide rapid market feedback, introduce international standards, enhance production flexibility, and improve risk resistance capabilities - Xuzhou C.banner Footwear Co., Ltd. is undergoing industrial upgrading, exploring European and American orders, and implementing a dual market strategy[62](index=62&type=chunk) - The dual market strategy helps improve product quality design, introduce international standards, enhance production flexibility, and improve risk resistance capabilities[62](index=62&type=chunk) [Increased Marketing on High-Traffic Social Media Platforms](index=23&type=section&id=%E5%8A%A0%E5%A4%A7%E9%AB%98%E6%B5%81%E9%87%8F%E7%A4%BE%E4%BA%A4%E5%AA%92%E9%AB%94%E5%B9%B3%E5%8F%B0%E7%9A%84%E7%87%9F%E9%8A%B7%E5%8A%9B%E5%BA%A6) Facing the booming e-commerce market, the Company actively deploys on content e-commerce platforms like Xiaohongshu and Douyin, enhancing user engagement through live streaming, short videos, and KOL collaborations, and deepening its online-offline integration strategy to build a private domain traffic closed-loop - In H1 2025, national online retail sales grew year-on-year by **8.5%**[64](index=64&type=chunk) - The Company actively deploys on content e-commerce platforms like Xiaohongshu and Douyin, establishes a multi-dimensional live streaming system, and deepens its online-offline integration strategy[65](index=65&type=chunk)[66](index=66&type=chunk) - Adopts a tiered KOL collaboration strategy, balancing product quality with price advantages to build customer loyalty[67](index=67&type=chunk) - For the six months ended 30 June 2025, the Group's total revenue decreased year-on-year by **11.2%** to **RMB 640.2 million**[44](index=44&type=chunk) - Loss for the period was **RMB 141.8 million**, mainly attributable to the impairment loss provision for Nanjing Meilihua trade debts and decreased revenue from the fashion footwear business[44](index=44&type=chunk) - As at end of June 2025, the Company's total retail stores were **968**, a net decrease of **47 stores** since the beginning of the year[44](index=44&type=chunk) [Outlook](index=24&type=section&id=%E5%B1%95%20%E6%9C%9B) Global economic outlook faces downside risks, with escalating trade tensions and policy uncertainties potentially curbing growth; China's economy slows, with weak consumption growth; the Company will fully advance its digitalization strategy, leveraging technology to achieve comprehensive upgrades in product design, production management, and marketing services, while focusing on core and blockbuster products to address challenges and achieve sustainable development - Global economic growth is expected to decline to **2.3%** in H2 2025, with only a weak recovery projected between 2026 and 2027[70](index=70&type=chunk) - The Company will fully advance its digitalization strategy, leveraging technology to achieve comprehensive upgrades in product design, production management, and marketing services[71](index=71&type=chunk) - The Company will utilize AI technology to optimize market planning, enhance operational efficiency, and apply it to core systems such as store management, member services, and cloud warehouse logistics[72](index=72&type=chunk) - Product strategy will focus on enhancing core products and creating blockbuster products, with both scale and gross profit expected to grow in H2 2025[73](index=73&type=chunk) [Financial Review](index=26&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) For the six months ended 30 June 2025, the Company's total revenue decreased year-on-year by 11.2% to **RMB 640.2 million**, with a loss for the period of **RMB 141.8 million**, a **369.6%** decrease from the profit in the same period last year; gross profit margin increased by **1.4 percentage points** to **59.7%** [Overall Financial Performance](index=26&type=section&id=%E7%B8%BD%E9%AB%94%E8%B2%A1%E5%8B%99%E8%A1%A8%E7%8F%BE) For the six months ended 30 June 2025, the Company's total revenue decreased year-on-year by **11.2%** to **RMB 640.2 million**, with a loss for the period of **RMB 141.8 million**, a **369.6%** decrease from the profit in the same period last year - Total revenue decreased by **11.2%** to **RMB 640.2 million**[76](index=76&type=chunk) - Loss for the period was **RMB 141.8 million**, a **369.6%** decrease from the profit of **RMB 52.6 million** in the same period last year[76](index=76&type=chunk) [Revenue Analysis](index=26&type=section&id=%E6%94%B6%E7%9B%8A%E5%88%86%E6%9E%90) Revenue decrease mainly stemmed from the footwear business, with retail and wholesale business revenue decreasing by **RMB 46.0 million**, contract manufacturing business revenue decreasing by **RMB 43.4 million**, and toy retail business revenue growing by **24.9%** Revenue by Business Segment and Growth Rate | | 2025 RMB thousands | Percentage of Total Revenue (%) | 2024 RMB thousands | Percentage of Total Revenue (%) | Growth Percentage (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Retail and Wholesale Business | 566,406 | 88.5 | 612,389 | 85.0 | (7.5) | | Contract Manufacturing Business | 28,989 | 4.5 | 72,398 | 10.0 | (60.0) | | Toy Retail Business | 44,770 | 7.0 | 35,856 | 5.0 | 24.9 | | Total | 640,165 | 100 | 720,643 | 100 | (11.2) | - Revenue decrease mainly stemmed from the footwear business, affected by weak domestic consumer demand and tariffs[77](index=77&type=chunk) [Profitability Analysis](index=26&type=section&id=%E7%9B%88%E5%88%A9%E8%83%BD%E5%8A%9B%E5%88%86%E6%9E%90) Gross profit decreased by **9.0%** to **RMB 381.9 million**, but gross profit margin increased by **1.4 percentage points** to **59.7%**; distribution and selling expenses decreased by **4.7%**, administrative and general expenses increased by **3.4%**; other income and expenses recorded a loss of **RMB 124.5 million**, mainly due to impairment provision for trade debts; income tax expense decreased by **56.4%** - Gross profit decreased by **9.0%** to **RMB 381.9 million**, gross profit margin increased by **1.4 percentage points** to **59.7%**[78](index=78&type=chunk) - Distribution and selling expenses decreased by **4.7%** to **RMB 330.2 million**, accounting for **51.6%** of revenue[78](index=78&type=chunk) - Other income and expenses and other gains and losses recorded a loss of **RMB 124.5 million**, mainly due to an impairment provision of **RMB 149.1 million** for trade debts due from Nanjing Meilihua[79](index=79&type=chunk) - Income tax expense decreased by **56.4%** to **RMB 7.1 million**[80](index=80&type=chunk) [Liquidity and Financial Resources](index=27&type=section&id=%E6%B5%81%E5%8B%95%E8%B3%87%E7%94%A2%E5%8F%8A%E8%B2%A1%E5%8B%99%E8%B3%87%E6%BA%90) As at 30 June 2025, bank balances and cash were **RMB 483.4 million**; net cash generated from operating activities was **RMB 76.6 million**, a year-on-year increase of **RMB 49.9 million**; net current assets decreased by **21.8%** to **RMB 672.8 million** - Bank balances and cash were **RMB 483.4 million**, an increase from end of 2024[81](index=81&type=chunk) - Net cash generated from operating activities was **RMB 76.6 million**, a year-on-year increase of **RMB 49.9 million**[81](index=81&type=chunk) - Net current assets decreased by **RMB 187.1 million** or **21.8%** to **RMB 672.8 million**[82](index=82&type=chunk) [Pledge of Assets, Contingent Liabilities and Capital Commitments](index=28&type=section&id=%E8%B3%87%E7%94%A2%E8%B3%AA%E6%8A%BC%E3%80%81%E6%88%96%E7%84%B6%E8%B2%A0%E5%82%B5%E5%8F%8A%E8%B3%87%E6%9C%AC%E6%89%BF%E6%93%94) As at 30 June 2025, the Company had no pledged assets, no material contingent liabilities, and no contracted capital commitments not provided for - As at 30 June 2025, the Group had no pledged assets[83](index=83&type=chunk) - As at 30 June 2025, the Group had no material contingent liabilities[84](index=84&type=chunk) - As at 30 June 2025, the Group had no contracted capital commitments not provided for in the condensed consolidated financial statements[85](index=85&type=chunk) [Exchange Rate Risk Management](index=28&type=section&id=%E5%8C%AF%E5%85%8C%E9%A2%A8%E9%9A%AA%E7%AE%A1%E7%90%86) The Company's sales are primarily denominated in RMB, while contract manufacturing business is denominated in USD; exchange gains of **RMB 0.3 million** were recorded for the period, with no derivative instruments held to hedge foreign exchange risk - Sales are primarily denominated in RMB, while contract manufacturing business is primarily denominated in USD[86](index=86&type=chunk) - Exchange gains of **RMB 0.3 million** were recorded for the period, compared to a loss of **RMB 1.8 million** in the same period last year[86](index=86&type=chunk) [Future Plans for Material Investments or Capital Assets](index=28&type=section&id=%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) Other than ordinary course of business, as at 30 June 2025, the Company had no specific plans to acquire any material investments or capital assets - As at 30 June 2025, other than ordinary course of business, the Group had no specific plans to acquire any material investments or capital assets[87](index=87&type=chunk) [Human Resources](index=28&type=section&id=%E4%BA%BA%E5%8A%9B%E8%B3%87%E6%BA%90) As at 30 June 2025, the Company had **3,999 employees**, a decrease from end of 2024; the Company offers competitive remuneration and benefits to retain talent - As at 30 June 2025, the Group had **3,999 employees** (31 December 2024: **4,412 employees**)[88](index=88&type=chunk) - The Company offers competitive remuneration and benefits, including mandatory provident fund, insurance and medical benefits, and discretionary bonuses[88](index=88&type=chunk) [Significant Events](index=29&type=section&id=%E9%87%8D%E5%A4%A7%E4%BA%8B%E9%A0%85) Subsequent to the reporting period, the Company reached a civil mediation settlement with former subsidiary Nanjing Meilihua regarding trade debts, agreeing to repay **RMB 65.152 million** in installments from October 2025 to March 2045 - Subsequent to the reporting period, the Company reached a civil mediation settlement with Nanjing Meilihua regarding trade debts, agreeing to repay **RMB 65.152 million** in installments from October 2025 to March 2045[89](index=89&type=chunk) [Interim Dividends](index=29&type=section&id=%E4%B8%AD%E6%9C%9F%E8%82%A1%E6%81%AF) The Board did not recommend the payment of an interim dividend for the six months ended 30 June 2025 - The Board did not recommend the payment of an interim dividend for the six months ended 30 June 2025[90](index=90&type=chunk) [Standard Code for Securities Transactions by Directors](index=29&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%E7%9A%84%E6%A8%99%E6%BA%96%E5%AE%88%E5%89%87) The Company has adopted a code of conduct for securities transactions by directors no less exacting than Appendix C3 of the Listing Rules, and confirmed that directors have complied with it throughout the reporting period - The Company has adopted a code of conduct for securities transactions by directors, and directors have confirmed compliance throughout the reporting period[91](index=91&type=chunk) [Corporate Governance](index=29&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB) The Company is committed to maintaining high standards of corporate governance, and has complied with the Corporate Governance Code in Appendix C1 of the Listing Rules during the reporting period, however, Non-executive Director Ms. Cheng Xuanxuan was unable to attend the Annual General Meeting - The Company has complied with the Corporate Governance Code in Appendix C1 of the Listing Rules, but Non-executive Director Ms. Cheng Xuanxuan was unable to attend the Annual General Meeting due to other commitments[92](index=92&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=30&type=section&id=%E8%B3%BC%E8%B2%B7%E3%80%81%E5%87%BA%E5%94%AE%E6%88%96%E8%B4%96%E5%9B%9E%E6%9C%AC%E5%85%AC%E5%8F%B8%E4%B8%8A%E5%B8%82%E8%AD%89%E5%88%B8) For the six months ended 30 June 2025, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any listed securities, and the Company held no treasury shares - For the six months ended 30 June 2025, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any listed securities[93](index=93&type=chunk) - As at 30 June 2025, the Company held no treasury shares[94](index=94&type=chunk) [Audit Committee](index=30&type=section&id=%E5%AF%A9%E6%A0%B8%E5%A7%94%E5%93%A1%E6%9C%83) The Audit Committee has reviewed the accounting principles and policies adopted by the Group and the unaudited condensed consolidated interim results for the six months ended 30 June 2025 - The Audit Committee has reviewed the accounting principles and policies adopted by the Group and the unaudited condensed consolidated interim results for the six months ended 30 June 2025[95](index=95&type=chunk) [Publication of Unaudited Condensed Consolidated Interim Results and 2025 Interim Report on HKEX and Company Website](index=30&type=section&id=%E6%96%BC%E9%A6%99%E6%B8%AF%E8%81%AF%E4%BA%A4%E6%89%80%E5%8F%8A%E6%9C%AC%E5%85%AC%E5%8F%B8%E7%B6%B2%E7%AB%99%E5%88%8A%E8%BC%89%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%A5%AD%E7%B8%BE%E5%8F%8A2025%E5%B9%B4%20%E4%B8%AD%E6%9C%9F%E5%A0%B1%E5%91%8A) This interim results announcement has been published on the HKEX and the Company's website, and the 2025 interim report will be dispatched to shareholders and published on relevant websites in due course - This interim results announcement has been published on the HKEX and the Company's website[96](index=96&type=chunk) [By Order of the Board](index=30&type=section&id=%E6%89%BF%E8%91%A3%E4%BA%8B%E6%9C%83%E5%91%BD) Mr. Chen Yixi, Chairman of the Board, signed this announcement on 28 August 2025 - Mr. Chen Yixi, Chairman of the Board, signed this announcement on 28 August 2025[97](index=97&type=chunk)[98](index=98&type=chunk)

Financial Performance - The group's revenue decreased by approximately RMB 205.3 million or 39.1% to about RMB 319.2 million for the six months ended June 30, 2025, compared to the same period in 2024[3]. - Gross profit fell by approximately RMB 145.5 million or 37.1% to about RMB 246.3 million for the same period[3]. - Profit before tax decreased by approximately RMB 69.7 million or 35.6% to about RMB 125.9 million[3]. - Profit attributable to equity holders of the company decreased by approximately RMB 50.5 million or 37.6% to about RMB 83.7 million[3]. - Total comprehensive income for the period was RMB 80.1 million, down from RMB 135.6 million in the previous year[5]. - The group's profit before tax for the six months ended June 30, 2025, was RMB 72,926,000, a decrease of 45% compared to RMB 132,687,000 for the same period in 2024[13]. - Net profit for the six months ended June 30, 2025, was approximately RMB 83.7 million, a decrease of about RMB 50.5 million or 37.6% from RMB 134.2 million in the same period of 2024, attributed to a decline in product sales[69]. Dividend and Shareholder Returns - The board of directors did not recommend the declaration of any interim dividend for the six months ended June 30, 2025[3]. - The group declared a final dividend of HKD 0.5 per ordinary share for the six months ended June 30, 2025, down from HKD 0.6 in 2024, totaling RMB 338,663,000 compared to RMB 403,765,000[18]. - The company did not declare any interim dividends for the six months ended June 30, 2025, consistent with the previous year[18]. - The board does not recommend declaring any interim dividend for the six months ended June 30, 2025[87]. Assets and Liabilities - Cash and cash equivalents decreased to RMB 1,042.4 million from RMB 1,130.6 million as of December 31, 2024[6]. - Trade receivables decreased significantly to RMB 243.2 million from RMB 420.6 million[6]. - The total assets less current liabilities amounted to RMB 1,258.4 million, down from RMB 1,550.7 million[7]. - The company's equity attributable to equity holders decreased to RMB 1,207.8 million from RMB 1,466.3 million[7]. - As of June 30, 2025, the company's current assets net value was approximately RMB 748.8 million, down from RMB 1,055.7 million as of December 31, 2024[70]. - Total interest-bearing bank loans and other borrowings increased to approximately RMB 684.0 million, up about RMB 257.1 million or 60.2% from RMB 426.9 million at the end of 2024[71]. - The debt-to-equity ratio increased from approximately 29.1% as of December 31, 2024, to about 56.6% as of June 30, 2025[73]. Revenue Sources - The group's flagship product, Jin Sangzi throat lozenges (OTC), accounted for approximately 90.6% of total revenue for the six months ended June 30, 2025[38]. - Revenue from the sales of Jin Sangzi throat lozenges (OTC) was approximately RMB 289.1 million, down by RMB 189.3 million or 39.6% from RMB 478.4 million in the previous year[55]. - The Jin Sangzi throat treasure series products contributed about 8.9% to total revenue for the same period, with new export markets including South Korea and Peru[40]. - Other products, including Ginkgo biloba tablets and the new Jin Sangzi intestinal treasure, represented about 0.5% of total revenue[41]. Research and Development - The group has developed 35 new products since 1994, obtaining production licenses for 8 pharmaceutical products, 21 food products, 1 health food product, and 1 medical device[42]. - The group is collaborating with Beijing Agricultural University on the development of a new composite probiotic lozenge, which has obtained six patents[41]. - The company launched the Jin Sang Zi compound probiotic lozenges in collaboration with Beijing Agricultural University, utilizing proprietary strains and securing six patents[43]. - By 2025, the Jin Sang Zi compound probiotic series will be upgraded to include nine patented strains, significantly enhancing its efficacy in areas such as immune regulation and blood sugar control[43]. - The group has a strong focus on R&D, collaborating with hospitals and research institutions to enhance product development[42]. Market Position and Strategy - The company aims to strengthen its brand recognition and image in China through increased advertising and targeted marketing strategies[53]. - The company aims to strengthen its market position in the throat lozenge market and expand its market share in the pharmaceutical and food sectors in the second half of 2025[82]. - The company has successfully exported products to over 60 countries and regions, with new markets including South Korea and Peru added in early 2025[46]. - The company has established a flagship store on Tmall, introducing various new products including six flavors of Jin Sang Zi throat lozenges[48]. - The company has signed promotional agreements with 11 promoters to enhance local market penetration and feedback[49]. Operational Updates - The company plans to enhance its production capacity by constructing a new production base in Liuzhou, Guangxi, covering an area of approximately 60,000 square meters, which includes a research and development center and automated production lines[53]. - The company has selected a 48-acre site for the second phase of the Jin Sangzi new base, which is expected to have a built-up area of approximately 50,000 square meters, focusing on the development of health products[54]. - The construction of the food production plant and R&D center has completed above-ground construction and has commenced internal construction as of June 30, 2025[85]. - The total amount allocated for the construction of the food production plant and R&D center is HKD 177.4 million, with an unutilized balance of HKD 151.4 million as of June 30, 2025[84]. - The company has reallocated approximately HKD 37.997 million originally intended for establishing a Chinese herbal processing base to the construction of the food production plant and R&D center[84]. Governance and Compliance - The audit committee has reviewed the unaudited interim consolidated financial statements for the six months ended June 30, 2025, and found the existing risk management and internal control systems to be effective and adequate[92]. - The company has adopted a corporate governance code to ensure high standards of corporate governance and protect shareholder interests[88].

[Financial Highlights](index=1&type=section&id=Financial%20Highlights) The Group's unaudited interim results for the six months ended June 30, 2025, show a 10.3% year-on-year increase in revenue to RMB 184.5 million, while gross profit slightly decreased by 1.2%, profit attributable to equity holders of the Company fell by 22.0%, and basic earnings per share also declined | Indicator | H1 2025 (RMB million) | H1 2024 (RMB million) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 184.5 | 167.2 | +10.3% | | Gross Profit | 49.4 | 50.0 | -1.2% | | Profit attributable to equity holders of the Company | 18.8 | 24.1 | -22.0% | | Basic earnings per share | 4.71 cents | 6.02 cents | -21.76% | [Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=2&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) This section presents detailed profit or loss and other comprehensive income data for the six months ended June 30, 2025, showing increased revenue but also higher cost of services, selling and marketing expenses, and administrative expenses, leading to a decrease in profit before tax and profit for the period, while exchange differences shifted from loss to gain, impacting other comprehensive income | Indicator | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue | 184,513 | 167,201 | | Cost of services | (135,146) | (117,213) | | Gross Profit | 49,367 | 49,988 | | Other income, other gains and losses, net | 124 | (400) | | Selling and marketing expenses | (1,024) | (716) | | Administrative expenses | (23,909) | (15,709) | | Reversal of impairment losses on financial and contract assets | 907 | 405 | | Finance costs | (41) | (56) | | Profit before tax | 25,424 | 33,512 | | Income tax expense | (6,587) | (9,495) | | Profit for the period | 18,837 | 24,017 | | Exchange differences arising from translation of overseas operations | (1,955) | 750 | | Total comprehensive income for the period | 16,882 | 24,767 | | Profit attributable to equity holders of the Company | 18,838 | 24,084 | | Basic earnings per share | RMB 4.71 cents | RMB 6.02 cents | [Interim Condensed Consolidated Statement of Financial Position](index=4&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) This section presents the consolidated financial position as of June 30, 2025, showing increases in both non-current and current assets, particularly in property, plant and equipment and properties under development, while total current liabilities slightly decreased, leading to improved net current assets and total equity, reflecting a robust financial structure | Indicator | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | **Non-current assets** | | | | Property, plant and equipment | 221,456 | 205,443 | | Right-of-use assets | 1,622 | 1,794 | | Deferred tax assets | 2,111 | 2,190 | | **Current assets** | | | | Properties under development | 157,157 | 140,973 | | Trade receivables | 52,306 | 55,717 | | Contract assets | 40,708 | 41,147 | | Cash and cash equivalents | 216,242 | 223,944 | | **Current liabilities** | | | | Trade payables | 23,162 | 24,302 | | Other payables and accrued expenses | 88,319 | 88,988 | | Contract liabilities | 95,767 | 96,555 | | Tax payable | 2,873 | 906 | | **Non-current liabilities** | | | | Provisions | 984 | 998 | | Lease liabilities | 1,590 | 1,595 | | Deferred tax liabilities | 590 | 590 | | **Total equity** | 516,853 | 499,971 | [Notes to the Interim Condensed Consolidated Financial Information](index=6&type=section&id=Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Information) This section provides detailed notes to the interim condensed consolidated financial information, covering key financial details such as company information, accounting policies, operating segments, revenue composition, taxation, dividends, earnings per share, receivables and payables, share capital, and related party transactions, offering essential context and supplementary information for understanding the financial statements [1. Company Information](index=6&type=section&id=1.%20Company%20Information) Xingye Wulian Service Group Co., Ltd. was incorporated in the Cayman Islands and listed on the Main Board of the Hong Kong Stock Exchange on March 9, 2020, primarily engaging in property management and value-added services, property engineering services, and property development, with Vistra Trust (BVI) Limited as its ultimate controlling company - The Company was incorporated on August 12, 2019, under the laws of the Cayman Islands and listed on the Main Board of the Hong Kong Stock Exchange on March 9, 2020[9](index=9&type=chunk) - The Group primarily engages in property management and value-added services, property engineering services, and property development[9](index=9&type=chunk) - The ultimate controlling company of the Company is Vistra Trust (BVI) Limited (as trustee of Fenghua Trust), a trust established by Ms. Huang Yanping, with Ms. Zhang Huiqi (a non-executive Director of the Company) as the protector[10](index=10&type=chunk) [2.1 Basis of Presentation](index=6&type=section&id=2.1%20Basis%20of%20Presentation) The interim condensed consolidated financial information is prepared in RMB, with all values rounded to the nearest thousand, in accordance with the disclosure requirements of Appendix D2 of the Listing Rules and International Accounting Standard 34 "Interim Financial Reporting" - The interim condensed consolidated financial information is prepared in accordance with the applicable disclosure requirements of Appendix D2 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited and International Accounting Standard 34 "Interim Financial Reporting"[11](index=11&type=chunk) - The financial information is presented in RMB, with all values rounded to the nearest thousand[11](index=11&type=chunk) [2.2 Changes in Accounting Policies and Disclosures](index=6&type=section&id=2.2%20Changes%20in%20Accounting%20Policies%20and%20Disclosures) The accounting policies adopted for preparing the interim condensed consolidated financial information are consistent with the prior year, except for the initial adoption of new and revised International Financial Reporting Standards, including IAS 21 (Amendment) "Lack of Exchangeability" - The accounting policies adopted in preparing the interim condensed consolidated financial information are consistent with those adopted in the preparation of the Group’s annual consolidated financial statements for the year ended December 31, 2024, except for the initial adoption of the following new and revised International Financial Reporting Standards during the current period[12](index=12&type=chunk) - The newly adopted standard includes IAS 21 (Amendment) "Lack of Exchangeability"[13](index=13&type=chunk) [3. Operating Segment Information](index=7&type=section&id=3.%20Operating%20Segment%20Information) The Group categorizes its operations into four reportable segments: property management and value-added services, property engineering services, property development, and others, with management allocating resources and assessing performance based on segment results, noting stable revenue in property management, significant growth in property engineering, and ongoing losses in property development, with no geographical analysis presented as operations are solely in Mainland China - The Group's business units are categorized into four reportable operating segments based on the services provided: property management and value-added services, property engineering services, property development, and others[14](index=14&type=chunk)[17](index=17&type=chunk) Segment Revenue (RMB thousand) | Segment | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Property Management and Value-Added Services | 150,392 | 148,201 | | Property Engineering Services | 14,766 | 2,668 | | Property Development | – | – | | Others | 19,355 | 16,332 | | **Total** | **184,513** | **167,201** | Segment Results (RMB thousand) | Segment | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Property Management and Value-Added Services | 22,185 | 35,954 | | Property Engineering Services | 376 | (2,335) | | Property Development | (355) | (117) | | Others | 4,061 | 2,064 | | **Total Segment Results** | **26,267** | **35,566** | - The Group operates solely in Mainland China, thus no geographical analysis of operations is presented[20](index=20&type=chunk) [4. Revenue](index=9&type=section&id=4.%20Revenue) The Group's revenue primarily stems from property management and value-added services, property engineering services, and other businesses like club services, charging pile services, and intermediary services, with revenue from property management and engineering services recognized over time, while other services are recognized at a point in time Revenue Analysis (RMB thousand) | Service Type | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Property Management and Value-Added Services | 150,392 | 148,201 | | Property Engineering Services | 14,766 | 2,668 | | Club Services | 7,232 | 6,881 | | Charging Pile Services | 8,059 | 6,281 | | Intermediary Services | 2,375 | 870 | | Others | 1,689 | 2,300 | | **Total** | **184,513** | **167,201** | Revenue Recognition Timing (RMB thousand) | Revenue Recognition Timing | H1 2025 | H1 2024 | | :--- | :--- | :--- | | At a point in time (Value-added services, club services, charging pile services, intermediary services, others) | 22,762 | 19,063 | | Over a period of time (Property management, property engineering services) | 161,751 | 148,138 | | **Total** | **184,513** | **167,201** | - Property management and value-added services are primarily provided to properties developed by related parties, including Yongzuan Group, Zhengsheng Industrial Group, and Zhengsheng Development Group[21](index=21&type=chunk) [5. Other Income, Other Gains and Losses, Net](index=10&type=section&id=5.%20Other%20Income%2C%20Other%20Gains%20and%20Losses%2C%20Net) Other income, other gains and losses, net, shifted from a loss in the prior period to a gain this period, primarily due to a significant reduction in exchange difference losses, with government grants and interest income also contributing Other Income, Other Gains and Losses, Net (RMB thousand) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Government grants | 55 | 18 | | Interest income | 73 | 230 | | Exchange differences | (1) | (645) | | Other losses | (3) | (3) | | **Total** | **124** | **(400)** | - Government grants relate to income received or receivable as compensation for expenses or losses incurred, or as immediate financial support to the Group without future related costs, recognized in profit or loss during the period the grants become receivable[22](index=22&type=chunk) [6. Profit Before Tax](index=10&type=section&id=6.%20Profit%20Before%20Tax) This section details the key expenses and income affecting profit before tax, showing increases in staff costs, cost of services provided, and research and development expenses, alongside an increase in the reversal of impairment losses on financial and contract assets during the reporting period Items Deducted From/Credited To Profit Before Tax (RMB thousand) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Staff costs (including Directors' emoluments) | 47,504 | 40,154 | | - Wages and salaries | 42,488 | 35,943 | | - Contributions to retirement benefit schemes | 5,016 | 4,211 | | Cost of services provided | 135,246 | 117,213 | | Depreciation of property, plant and equipment | 1,119 | 1,036 | | Depreciation of right-of-use assets | 172 | 172 | | Net exchange differences | (1) | 645 | | Research and development expenses | 1,201 | 884 | | Reversal of impairment losses on financial and contract assets | (907) | (405) | [7. Income Tax Expense](index=11&type=section&id=7.%20Income%20Tax%20Expense) The Group's income tax expense primarily arises from its Mainland China operations, with some subsidiaries enjoying a preferential corporate tax rate of 5% and Henan Wuxiang Intelligent Technology Co., Ltd. benefiting from a 15% high-tech enterprise preferential tax rate, while no income tax is levied in the Cayman Islands and British Virgin Islands, and overall income tax expense decreased during the reporting period - The Group is not subject to any income tax in the Cayman Islands and the British Virgin Islands[24](index=24&type=chunk) - Subsidiaries operating in Mainland China are subject to corporate income tax at 25% of their assessable income, with some companies enjoying a preferential tax rate of 5%, and Henan Wuxiang Intelligent Technology Co., Ltd. benefiting from a 15% preferential tax rate for high-tech enterprises[25](index=25&type=chunk) Income Tax Expense (RMB thousand) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Current tax - China corporate income tax | 6,507 | 9,266 | | Deferred tax - Origination and reversal of temporary differences | 80 | 229 | | **Total** | **6,587** | **9,495** | [8. Dividends](index=11&type=section&id=8.%20Dividends) The Board of Directors does not recommend the payment of an interim dividend for the six months ended June 30, 2025, consistent with the prior corresponding period - The Board of Directors does not recommend the payment of an interim dividend for the six months ended June 30, 2025 (six months ended June 30, 2024: nil)[27](index=27&type=chunk) [9. Earnings Per Share Attributable to Equity Holders of the Company](index=11&type=section&id=9.%20Earnings%20Per%20Share%20Attributable%20to%20Equity%20Holders%20of%20the%20Company) Basic earnings per share are calculated based on the profit attributable to equity holders of the Company for the period and the weighted average number of ordinary shares outstanding during the period, with no potentially dilutive ordinary shares issued as of the end of the reporting period - The basic earnings per share amount is calculated based on the profit attributable to equity holders of the Company for the period and the weighted average number of 400,000,000 ordinary shares outstanding during the period[28](index=28&type=chunk)[31](index=31&type=chunk) Basic Earnings Per Share Calculation (RMB thousand) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Profit attributable to equity holders of the Company | 18,838 | 24,084 | | Weighted average number of ordinary shares outstanding | 400,000,000 | 400,000,000 | - As of June 30, 2025, and 2024, the Group had no potentially dilutive ordinary shares outstanding[28](index=28&type=chunk) [10. Trade Receivables](index=12&type=section&id=10.%20Trade%20Receivables) This section details the composition and aging analysis of trade receivables, including amounts due from third parties and related parties, showing a decrease in total trade receivables at the end of the reporting period, with a significant reduction in related party trade receivables and an increase in third-party trade receivables Trade Receivables (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Trade receivables from third parties | 39,474 | 29,436 | | Less: Loss allowance | (1,295) | (914) | | **Net trade receivables from third parties** | **38,179** | **28,522** | | Trade receivables from related parties | 15,776 | 30,228 | | Less: Loss allowance | (1,649) | (3,033) | | **Net trade receivables from related parties** | **14,127** | **27,195** | | **Total** | **52,306** | **55,717** | Aging Analysis of Trade Receivables (RMB thousand) | Aging | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Within 1 year | 42,846 | 39,946 | | 1 to 2 years | 7,301 | 14,111 | | 2 to 3 years | 2,011 | 1,523 | | 3 to 4 years | 148 | 137 | | **Total** | **52,306** | **55,717** | [11. Trade Payables](index=13&type=section&id=11.%20Trade%20Payables) This section provides an aging analysis of trade payables, which are non-interest-bearing, typically settled within three months, and whose carrying amounts approximate their fair values Aging Analysis of Trade Payables (RMB thousand) | Aging | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Within 1 year | 20,699 | 21,245 | | Over 1 year | 2,463 | 3,057 | | **Total** | **23,162** | **24,302** | - Trade payables are non-interest-bearing and generally settled within three months, with their carrying amounts approximating their fair values[32](index=32&type=chunk) [12. Share Capital](index=13&type=section&id=12.%20Share%20Capital) This section details the Company's share capital structure, including authorized share capital and the number and amount of issued and fully paid ordinary shares, noting that the number of issued shares remained unchanged during the reporting period, with all shares ranking pari passu in all respects Share Capital (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Authorized share capital (ordinary shares of HK$0.01 each) | 89,858 | 89,858 | | Issued and fully paid (400,000,000 ordinary shares of HK$0.01 each) | 3,572 | 3,572 | - All shares issued during the period rank pari passu in all respects with other existing issued shares[33](index=33&type=chunk) [13. Related Party Transactions](index=14&type=section&id=13.%20Related%20Party%20Transactions) The Group engaged in various related party transactions, including providing property management and value-added services, property engineering services, and receiving property construction services from related parties, all conducted under mutually agreed terms and constituting continuing connected transactions under the Listing Rules, with outstanding balances at period-end, some settled via debt transfer agreements, and key management personnel compensation also disclosed Related Party Transactions (RMB thousand) | Transaction Type | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Provision of property management and value-added services to related parties | 11,631 | 5,094 | | Provision of property engineering services to related parties | 12,652 | 2,668 | | Provision of property construction services by related parties | (32,185) | – | - Related parties include Yongzuan Global Limited, Zhengsheng Industrial Co., Ltd. and its subsidiaries, and Henan Zhengsheng Enterprise Development Group Co., Ltd. and its subsidiaries, all related to the family trust of Ms. Zhang Huiqi, a non-executive Director of the Company[34](index=34&type=chunk) - Sales services provided to related parties are conducted under mutually agreed terms and constitute continuing connected transactions as defined in Chapter 14A of the Listing Rules[35](index=35&type=chunk)[36](index=36&type=chunk) - Henan Xingye IoT Management Technology Co., Ltd., a subsidiary of the Company, entered into debt transfer agreements with certain related parties to transfer receivables to Henan Zhengsheng Real Estate Co., Ltd. to settle net receivables and payables[37](index=37&type=chunk) Key Management Personnel Compensation (RMB thousand) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Short-term employee benefits | 725 | 1,037 | | Post-employment benefits | 81 | 80 | | **Total** | **806** | **1,117** | [Management Discussion and Analysis](index=16&type=section&id=Management%20Discussion%20and%20Analysis) This section provides an in-depth analysis of the Group's operating performance and financial position for the six months ended June 30, 2025, highlighting continued business expansion, particularly in managed property area and property engineering services revenue, but also a decrease in profit for the period due to increased cost of services, administrative expenses, and a decline in gross profit margin, with management detailing segment performance, cost control, financial metric changes, and future strategies including non-residential expansion, professional service enhancement, smart technology investment, and diversified value-added services [Business Overview](index=16&type=section&id=Business%20Overview) As a prominent property management service provider in Henan Province, the Group offers comprehensive property management, value-added, and property engineering services, with its managed property portfolio's gross floor area expanding and new property engineering contracts signed during the reporting period, alongside the acquisition of Zhengzhiyue in 2023 to expand into property development, with the Zhengzhou Zhengsheng Center project progressing well and expected completion by end of 2026 - The Group, established in 1999, is a renowned property management service provider in Henan Province, offering property management and value-added services, and property engineering services[40](index=40&type=chunk) - The gross floor area of the managed property portfolio expanded from approximately **11.0 million sq.m.** as of December 31, 2024, to approximately **11.5 million sq.m.** as of June 30, 2025, with the total gross floor area of the contracted property portfolio being approximately **15.8 million sq.m.**[41](index=41&type=chunk) - During the period, **20 new property engineering contracts** were entered into, with a total contract value of approximately **RMB 16.9 million**; the total contract value of remaining performance obligations for engineering services contracts was **RMB 52.8 million**[41](index=41&type=chunk) - The Group acquired Henan Zhengzhiyue Real Estate Co., Ltd. in 2023 to develop its property development business, with the Zhengzhou Zhengsheng Center project currently under construction and expected to be completed by the end of 2026[42](index=42&type=chunk) [Revenue](index=17&type=section&id=Revenue) The Group's total revenue increased by 10.3% to RMB 184.5 million during the period, primarily driven by higher revenue from property management and property engineering services segments, with property management and value-added services showing slight growth, property engineering services significantly increasing by 448.1%, and other revenue also rising, alongside a notable increase in revenue from related parties Revenue Breakdown (RMB thousand) | Service Category | H1 2025 | Share (%) | H1 2024 | Share (%) | | :--- | :--- | :--- | :--- | :--- | | Property Management and Value-Added Services | 150,392 | 81.5 | 148,201 | 88.6 | | Property Engineering Services | 14,766 | 8.0 | 2,668 | 1.6 | | Others | 19,355 | 10.5 | 16,332 | 9.8 | | **Total** | **184,513** | **100.0** | **167,201** | **100.0** | Revenue Sources (RMB thousand) | Source | H1 2025 | Share (%) | H1 2024 | Share (%) | | :--- | :--- | :--- | :--- | :--- | | Independent Third Parties | 160,230 | 86.8 | 159,439 | 95.4 | | Related Parties | 24,283 | 13.2 | 7,762 | 4.6 | | **Total** | **184,513** | **100.0** | **167,201** | **100.0** | - Total revenue increased by **10.3%** to **RMB 184.5 million**, primarily due to increased revenue from the property management and property engineering services segments[43](index=43&type=chunk) [Property Management and Value-Added Services](index=18&type=section&id=Property%20Management%20and%20Value-Added%20Services) Revenue from property management and value-added services increased by 1.5% to RMB 150.4 million, primarily due to the continuous expansion of managed properties and the growth of value-added services such as cooling and waste removal services - Revenue from property management and value-added services increased by **1.5%** from approximately **RMB 148.2 million** to approximately **RMB 150.4 million**[46](index=46&type=chunk) - The increase was mainly due to the continuous expansion of a diversified property portfolio of non-residential and residential properties, as well as the expansion of value-added services such as cooling services and waste removal services[46](index=46&type=chunk) [Property Engineering Services](index=18&type=section&id=Property%20Engineering%20Services) Revenue from property engineering services surged by 448.1% to RMB 14.8 million, primarily attributable to the expansion of installation services during the period - Revenue from property engineering services increased by **448.1%** from approximately **RMB 2.7 million** to approximately **RMB 14.8 million**[47](index=47&type=chunk) - The increase was mainly due to the expansion of installation services during the period[47](index=47&type=chunk) [Others](index=18&type=section&id=Others) Other revenue increased by 19.0% to RMB 19.4 million, primarily driven by higher revenue from charging pile services and club services - Other revenue increased by **19.0%** from approximately **RMB 16.3 million** to approximately **RMB 19.4 million**[48](index=48&type=chunk) - The increase was mainly due to more revenue generated from charging pile services and club services[48](index=48&type=chunk) [Cost of Services](index=18&type=section&id=Cost%20of%20Services) The Group's cost of services, primarily comprising subcontracting costs, staff costs, and materials and consumables, increased by 15.3% to RMB 135.1 million during the reporting period, consistent with the revenue growth, particularly in property engineering services - Cost of services increased by **15.3%** from approximately **RMB 117.2 million** to approximately **RMB 135.1 million**[49](index=49&type=chunk) - The increase was generally consistent with the revenue growth during the period, which was related to the increase in property engineering services[49](index=49&type=chunk) [Gross Profit and Gross Profit Margin](index=18&type=section&id=Gross%20Profit%20and%20Gross%20Profit%20Margin) Gross profit for the period slightly decreased by 1.2% to RMB 49.4 million, with the gross profit margin declining from 29.9% to 26.8%, primarily due to increased subcontracting labor costs, equipment expenses, and elevator maintenance costs - Gross profit slightly decreased by **1.2%** from approximately **RMB 50.0 million** to approximately **RMB 49.4 million**[50](index=50&type=chunk) - The gross profit margin decreased from **29.9%** to **26.8%**[50](index=50&type=chunk) - The decrease in gross profit margin was mainly due to the increase in subcontracting labor costs, equipment, and elevator maintenance costs during the period[50](index=50&type=chunk) [Other Income, Other Gains and Losses, Net](index=19&type=section&id=Other%20Income%2C%20Other%20Gains%20and%20Losses%2C%20Net) Other income, other gains and losses, net, shifted from a loss in the prior period to a gain of approximately RMB 0.1 million this period, primarily due to a reduction in exchange difference losses - Other income, other gains and losses, net, shifted from an other loss of approximately **RMB 0.4 million** to other income and gains of approximately **RMB 0.1 million**[51](index=51&type=chunk) - This was mainly due to a decrease in exchange difference losses recognized during the period[51](index=51&type=chunk) [Selling and Marketing Expenses](index=19&type=section&id=Selling%20and%20Marketing%20Expenses) Selling and marketing expenses increased by 42.9% to RMB 1.0 million, primarily associated with business expansion during the period - Selling and marketing expenses increased by **42.9%** from approximately **RMB 0.7 million** to approximately **RMB 1.0 million**[52](index=52&type=chunk) - The increase was mainly related to business expansion during the period[52](index=52&type=chunk) [Administrative Expenses](index=19&type=section&id=Administrative%20Expenses) Administrative expenses significantly increased by 52.2% to RMB 23.9 million, primarily due to higher staff costs - Administrative expenses increased by **52.2%** from approximately **RMB 15.7 million** to approximately **RMB 23.9 million**[53](index=53&type=chunk) - The increase was mainly due to higher staff costs during the period[53](index=53&type=chunk) [Finance Costs](index=19&type=section&id=Finance%20Costs) The Group's finance costs primarily refer to the imputed interest arising from right-of-use assets related to lease contract payments for leased properties - Finance costs refer to the imputed interest arising from right-of-use assets related to lease contract payments for leased properties[54](index=54&type=chunk) [Income Tax Expense](index=19&type=section&id=Income%20Tax%20Expense) Income tax expense decreased by 30.5% to RMB 6.6 million - Income tax expense decreased by **30.5%** from approximately **RMB 9.5 million** to approximately **RMB 6.6 million**[55](index=55&type=chunk) [Profit for the Period](index=19&type=section&id=Profit%20for%20the%20Period) Profit attributable to equity holders of the Company decreased by 22.0% to RMB 18.8 million, primarily due to the combined impact of the aforementioned factors - Profit attributable to equity holders of the Company decreased by **22.0%** from approximately **RMB 24.1 million** to approximately **RMB 18.8 million**[56](index=56&type=chunk) [Interim Dividends](index=19&type=section&id=Interim%20Dividends) The Board of Directors does not recommend the payment of an interim dividend for the six months ended June 30, 2025, consistent with the prior corresponding period - The Board of Directors does not recommend the payment of an interim dividend for the six months ended June 30, 2025 (six months ended June 30, 2024: nil)[57](index=57&type=chunk) [Financial Position](index=20&type=section&id=Financial%20Position) The Group maintains a sound financial position, with a slight increase in total current assets but a decrease in cash and cash equivalents, while property, plant and equipment and properties under development both grew, and total trade receivables declined due to proactive collection efforts, with trade payables, other payables, and contract liabilities also decreasing, and no interest-bearing borrowings, maintaining a stable current ratio [Property, Plant and Equipment](index=20&type=section&id=Property%2C%20Plant%20and%20Equipment) The net book value of property, plant and equipment increased by 7.8% to RMB 221.5 million, primarily due to increased construction in progress and the installation of charging piles - The net book value of property, plant and equipment was approximately **RMB 221.5 million**, representing a **7.8% increase** compared to December 31, 2024[58](index=58&type=chunk) - The increase was mainly due to increased construction in progress and the installation of charging piles during the period[58](index=58&type=chunk) [Properties Under Development](index=20&type=section&id=Properties%20Under%20Development) Properties under development increased by 11.5% to RMB 157.2 million, primarily due to ongoing construction work on properties under development - Properties under development were approximately **RMB 157.2 million**, representing an **11.5% increase** compared to December 31, 2024[59](index=59&type=chunk) - The increase was mainly due to ongoing construction work on properties under development during the period[59](index=59&type=chunk) [Trade Receivables](index=20&type=section&id=Trade%20Receivables) Both total trade receivables and net trade receivables after impairment allowance decreased, primarily due to increased repayments and the Group's proactive collection efforts, with related party trade receivables significantly decreasing by 47.7% while independent third-party trade receivables increased by 34.4%, and the Group has implemented various measures to manage credit risk - Total trade receivables and net trade receivables after impairment allowance were approximately **RMB 55.3 million** and **RMB 52.3 million**, respectively, representing a decrease compared to December 31, 2024[60](index=60&type=chunk) - The decrease was mainly due to increased repayments of trade receivables, resulting from the Group's efforts to recover trade receivables and implement management measures during the period[60](index=60&type=chunk) - Total trade receivables from related parties decreased by **47.7%** to approximately **RMB 15.8 million**[61](index=61&type=chunk) - Total trade receivables from independent third parties increased by **34.4%** to approximately **RMB 39.5 million**[62](index=62&type=chunk) - The Group has taken proactive measures to recover trade receivables, including regular review of debtors' credit risk, continuous communication to understand their operating conditions, and requesting partial repayments from time to time[63](index=63&type=chunk) [Trade Payables](index=21&type=section&id=Trade%20Payables) Trade payables decreased by 4.5% to RMB 23.2 million, primarily due to timely settlements during the period - Trade payables were approximately **RMB 23.2 million**, representing a **4.5% decrease** compared to December 31, 2024[64](index=64&type=chunk) - The decrease was due to timely settlement of trade payables during the period[64](index=64&type=chunk) [Other Payables and Accrued Expenses](index=21&type=section&id=Other%20Payables%20and%20Accrued%20Expenses) Other payables and accrued expenses slightly decreased by 0.8% to RMB 88.3 million, primarily due to more settlements made during the period - Other payables and accrued expenses were approximately **RMB 88.3 million**, representing a slight decrease of **0.8%** compared to December 31, 2024[65](index=65&type=chunk) - The decrease was mainly due to more settlements made during the period[65](index=65&type=chunk) [Contract Liabilities](index=21&type=section&id=Contract%20Liabilities) Contract liabilities decreased by 0.8% to RMB 95.8 million, primarily due to a reduction in customer prepayments for property management services - Contract liabilities decreased by **0.8%** from approximately **RMB 96.6 million** to approximately **RMB 95.8 million**[66](index=66&type=chunk) - The decrease was mainly due to a reduction in customer prepayments for property management services during the period[66](index=66&type=chunk) [Indebtedness](index=21&type=section&id=Indebtedness) The Group had no outstanding borrowings or unutilized bank facilities at the end of the reporting period, and lease liabilities decreased - The Group had no outstanding borrowings or unutilized bank facilities as of June 30, 2025[67](index=67&type=chunk) - Lease liabilities decreased from approximately **RMB 1.9 million** to approximately **RMB 1.8 million**[67](index=67&type=chunk) [Liquidity, Financial Resources and Capital Structure](index=22&type=section&id=Liquidity%2C%20Financial%20Resources%20and%20Capital%20Structure) The Group maintains a sound financial position with a slight increase in current assets but a decrease in cash and cash equivalents, no interest-bearing borrowings, thus no gearing ratio calculated, and a capital structure primarily composed of equity and reserves - Current assets were approximately **RMB 506.8 million**, representing a slight increase of approximately **RMB 0.1 million** compared to December 31, 2024[68](index=68&type=chunk) - Cash and cash equivalents were approximately **RMB 216.2 million**, representing a **3.4% decrease** compared to December 31, 2024[68](index=68&type=chunk) - The Group had no interest-bearing borrowings, thus no gearing ratio was calculated[68](index=68&type=chunk) - The Group's capital structure primarily consists of equity, including issued share capital and reserves[69](index=69&type=chunk) [Current Ratio](index=22&type=section&id=Current%20Ratio) The Group's current ratio as of June 30, 2025, was approximately 2.4 times, remaining stable compared to December 31, 2024 - The Group's current ratio as of June 30, 2025, was approximately **2.4 times**, compared to approximately **2.4 times** as of December 31, 2024[70](index=70&type=chunk) [Pledge of Assets and Charges on Assets of the Group](index=22&type=section&id=Pledge%20of%20Assets%20and%20Charges%20on%20Assets%20of%20the%20Group) As of June 30, 2025, the Group had not pledged any assets, and its assets were free from any charges - As of June 30, 2025, the Group had not pledged any assets, and its assets were free from any charges[71](index=71&type=chunk) [Contingent Liabilities](index=22&type=section&id=Contingent%20Liabilities) As of June 30, 2025, the Group had no significant contingent liabilities - As of June 30, 2025, the Group had no significant contingent liabilities[72](index=72&type=chunk) [Capital Commitments](index=22&type=section&id=Capital%20Commitments) As of June 30, 2025, the Group had capital expenditure commitments of RMB 249.0 million related to construction in progress - As of June 30, 2025, the Group had capital expenditure commitments of **RMB 249.0 million** related to construction in progress[73](index=73&type=chunk) [Foreign Exchange Risk](index=22&type=section&id=Foreign%20Exchange%20Risk) Operating primarily in China with most transactions settled in RMB, the Group faces minimal significant foreign exchange risk, limited to certain HKD-denominated bank balances, and currently has no contracts to hedge this risk - The Group primarily operates in China, with most transactions settled in RMB, thus it does not face significant foreign exchange risk, except for certain bank balances denominated in HKD held by the Company[74](index=74&type=chunk) - Currently, the Group has not entered into any contracts to hedge its foreign exchange risk[74](index=74&type=chunk) [Employment and Remuneration Policies](index=23&type=section&id=Employment%20and%20Remuneration%20Policies) As of June 30, 2025, the Group employed 922 staff, with remuneration policies determined by employee qualifications, position, seniority, and performance, participating in relevant Chinese employee social security schemes, and total staff-related costs for the period amounted to approximately RMB 47.5 million - As of June 30, 2025, the Group had **922 employees**[75](index=75&type=chunk) - Remuneration is determined based on employee qualifications, position, seniority, and performance, and employees participate in various social security schemes[75](index=75&type=chunk) - Total staff-related costs (including Directors' emoluments) for the period amounted to approximately **RMB 47.5 million**[75](index=75&type=chunk) [Significant Acquisitions and Disposals of Subsidiaries, Associates and Joint Ventures](index=23&type=section&id=Significant%20Acquisitions%20and%20Disposals%20of%20Subsidiaries%2C%20Associates%20and%20Joint%20Ventures) During the period, the Group had no significant acquisitions or disposals of subsidiaries, associates, or joint ventures - During the period, the Group had no significant acquisitions or disposals of subsidiaries, associates, or joint ventures[76](index=76&type=chunk) [Material Investments](index=23&type=section&id=Material%20Investments) As of June 30, 2025, the Group had no material investments exceeding 5% of its total assets - As of June 30, 2025, the Group had no material investments exceeding **5%** of its total assets[77](index=77&type=chunk) [Future Plans for Material Investments or Capital Assets](index=23&type=section&id=Future%20Plans%20for%20Material%20Investments%20or%20Capital%20Assets) As of June 30, 2025, the Group had no specific future plans for material investments or capital assets, and any such plans would be announced in due course in compliance with the Listing Rules - As of June 30, 2025, there were no specific plans for material investments or capital assets[78](index=78&type=chunk) - Should the Group engage in any plans for material investments or capital assets, the Company will make an announcement in due course and comply with the relevant rules under the Listing Rules[78](index=78&type=chunk) [Future Outlook](index=23&type=section&id=Future%20Outlook) The Group will continue to implement its core strategies, including actively expanding its property management portfolio with a focus on non-residential properties, prudently selecting high-quality M&A targets, comprehensively deepening professional service coverage, increasing investment in intelligent and digital construction utilizing large AI models, and expanding community value-added service categories around lifestyle and asset services, guided by "refined operations, long-term development, service excellence, and effective management" to drive service transformation and strive to become an "all-scenario service expert," continuously enhancing comprehensive strength and market competitiveness - Core strategies include: actively expanding the property management project portfolio (focusing on non-residential properties), prudently selecting high-quality M&A targets, comprehensively deepening the scope of professional services, increasing investment in intelligent and digital construction (utilizing large AI models), and expanding community value-added service categories around lifestyle and asset services[79](index=79&type=chunk)[80](index=80&type=chunk) - The Group will be guided by "refined operations, long-term development, service excellence, and effective management" to drive enterprise transformation towards customer satisfaction-centric services[80](index=80&type=chunk) - The service system will upgrade from traditional property management (PM) and facility management (FM) to integrated facility management (IFM), aligning with the trend of professional and integrated development in non-residential property services[80](index=80&type=chunk) - In the future, the Group will position itself as an "all-scenario service expert," improving its service system and capabilities across residential, non-residential, and public space service sectors[82](index=82&type=chunk) [Capital Raising Activities and Use of Proceeds from Global Offering](index=25&type=section&id=Capital%20Raising%20Activities%20and%20Use%20of%20Proceeds%20from%20Global%20Offering) The Company's global offering generated net proceeds of approximately RMB 149.6 million, with approximately RMB 89.6 million utilized as of June 30, 2025, primarily for enhancing property engineering services, property management services, and general working capital, while RMB 60.0 million allocated for selective acquisitions to expand business remains unutilized and is expected to be used by December 31, 2025 - The net proceeds from the global offering were approximately **RMB 149.6 million**[84](index=84&type=chunk) Use of Proceeds from Global Offering (RMB million) | Intended Use | Planned as % of Net Proceeds | Planned Net Proceeds | Utilized as of Dec 31, 2024 | Utilized During Current Period | Unutilized as of June 30, 2025 | | :--- | :--- | :--- | :--- | :--- | :--- | | Selective acquisitions of suitable targets to expand business | 40.1% | 60.0 | – | – | 60.0 | | Enhancing our property engineering services | 20.2% | 30.2 | 30.2 | – | – | | Enhancing our property management services | 29.7% | 44.5 | 44.5 | – | – | | General working capital | 10.0% | 14.9 | 14.9 | – | – | | **Total** | **100.0%** | **149.6** | **89.6** | **–** | **60.0** | - The **RMB 60.0 million** allocated for selective acquisitions is expected to be utilized on or before December 31, 2025[84](index=84&type=chunk) [Changes from 31 December 2024](index=26&type=section&id=Changes%20from%2031%20December%202024) Except as disclosed in this announcement, there have been no other material changes to the Group's financial position or the information disclosed in the Management Discussion and Analysis section of the Company's 2024 annual report - Except as disclosed in this announcement, there have been no other material changes to the Group's financial position or the information disclosed in the Management Discussion and Analysis section of the Company's 2024 annual report[85](index=85&type=chunk) [Events After the Reporting Period](index=26&type=section&id=Events%20After%20the%20Reporting%20Period) No significant events have occurred after the reporting period and up to the date of this announcement - Except as disclosed in this announcement, no significant events have occurred after the reporting period and up to the date of this announcement[86](index=86&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=26&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company%27s%20Listed%20Securities) Neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities during the period - Neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities during the period[87](index=87&type=chunk) [Corporate Governance Code](index=26&type=section&id=Corporate%20Governance%20Code) The Company has adopted and complied with the Corporate Governance Code during the period, with the exception of the combined roles of Chairman and Chief Executive Officer (Mr. Qiu Ming), an arrangement the Board believes is in the Company's best interest, with the current Board composition ensuring a balance of power and authority - The Company has adopted corporate governance practices based on the principles and code provisions set out in Appendix C1 of the Listing Rules[88](index=88&type=chunk) - The Company has complied with the relevant code provisions of the Corporate Governance Code during the period, except for a deviation from code provision C.2.1 (the roles of chairman and chief executive officer should be separate)[88](index=88&type=chunk) - The Board believes that Mr. Qiu Ming's continued dual role as Chairman and Chief Executive Officer is in the best interest of the Company, and the current composition and structure of the Board are sufficient to ensure a balance of power and authority[88](index=88&type=chunk) [Standard Code for Securities Transactions by Directors and Relevant Employees](index=27&type=section&id=Standard%20Code%20for%20Securities%20Transactions%20by%20Directors%20and%20Relevant%20Employees) The Company has adopted the Standard Code as set out in Appendix C3 of the Listing Rules and a stringent code of conduct for securities transactions by relevant employees deemed to possess inside information, with all directors and relevant employees confirming compliance with the standards - The Company has adopted the Standard Code as set out in Appendix C3 of the Listing Rules, and specific inquiries have been made to all Directors, each of whom has confirmed compliance with the required standards set out in the Standard Code during the period[90](index=90&type=chunk) - The Company has adopted a code of conduct for securities transactions by relevant employees of the Group who are considered to possess unpublished inside information of the Company or its securities, with terms no less stringent than those of the Standard Code[90](index=90&type=chunk) [Audit Committee](index=27&type=section&id=Audit%20Committee) Composed of three independent non-executive directors, the Audit Committee primarily assists the Board in reviewing and monitoring the Group's financial reporting processes, risk management, and internal control systems, and has reviewed the unaudited interim condensed consolidated financial results for the period - The Audit Committee comprises three independent non-executive Directors: Mr. Feng Zhidong (Chairman), Mr. Zhou Sheng, and Mr. Xu Chun[91](index=91&type=chunk) - The Audit Committee is primarily responsible for assisting the Board in reviewing and monitoring the Group's financial reporting processes, risk management, and internal control systems, and overseeing the audit process[91](index=91&type=chunk) - The Audit Committee has reviewed the accounting principles and practices adopted by the Group with the Company's management and discussed audit and financial reporting matters, including the review of the Group's unaudited interim condensed consolidated financial results for the period[91](index=91&type=chunk) [Publication of Interim Results Announcement and Interim Report](index=27&type=section&id=Publication%20of%20Interim%20Results%20Announcement%20and%20Interim%20Report) This interim results announcement has been published on the HKEXnews website and the Company's website, and the interim report will be published and dispatched to shareholders in due course - This interim results announcement is published on the HKEXnews website (www.hkexnews.hk) and the Company's website (www.xingyewulian.com)[92](index=92&type=chunk) - The Company's interim report for the period, containing all information required by Appendix D2 of the Listing Rules, will be published on the aforementioned websites and dispatched to the Company's shareholders upon request in due course[92](index=92&type=chunk) [Acknowledgement](index=28&type=section&id=Acknowledgement) The Board of Directors extends its sincere gratitude to the management, all employees, and shareholders for their dedicated efforts and strong support to the Group - The Company expresses its sincere gratitude to the management and all employees for their tireless and dedicated efforts to the Group, and to the shareholders for their continuous strong support to the Group[93](index=93&type=chunk) - The Board of Directors comprises Mr. Qiu Ming (Executive Director); Ms. Zhang Huiqi, Mr. Wang Jinhu, and Mr. Liu Zhenqiang (Non-executive Directors); and Mr. Xu Chun, Mr. Feng Zhidong, and Mr. Zhou Sheng (Independent Non-executive Directors)[94](index=94&type=chunk)

[Condensed Consolidated Financial Statements](index=1&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8) [Condensed Consolidated Statement of Profit or Loss](index=1&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%90%8D%E7%9B%8A%E8%A1%A8) For the six months ended June 30, 2025, the Group significantly narrowed its loss, primarily due to a substantial reduction in net fair value losses and lower finance costs, despite a slight increase in revenue Condensed Consolidated Statement of Profit or Loss (HKD Thousands) | Indicator | 2025 (HKD Thousands) | 2024 (HKD Thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 421,209 | 410,008 | 2.73% | | Cost of Sales | (155,625) | (143,855) | 8.18% | | Gross Profit | 265,584 | 266,153 | -0.21% | | Administrative Expenses | (221,779) | (222,794) | -0.46% | | Other Operating Expenses | (78,700) | (104,795) | -24.91% | | Net Fair Value Loss on Financial Instruments at FVTPL | (987) | (51,822) | -98.09% | | Other Losses — Net | (9,530) | (6,657) | 43.16% | | Finance Costs | (37,645) | (57,176) | -34.16% | | Share of Results of Associates | (4,370) | 20,436 | -121.38% | | Share of Results of Joint Ventures | 40,657 | (433,063) | -109.39% | | Loss Before Tax | (46,770) | (589,718) | -92.06% | | Loss for the Period | (50,513) | (594,847) | -91.51% | | Loss for the Period Attributable to Owners of the Company | (38,668) | (436,942) | -91.14% | | Basic and Diluted Loss Per Share (HK cents) | (7.8) | (88.6) | -91.20% | [Condensed Consolidated Statement of Comprehensive Income](index=2&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) The period saw a shift from a significant total comprehensive loss in the prior year to a positive value, driven by improved exchange differences on foreign operations and share of other comprehensive income from associates/joint ventures Condensed Consolidated Statement of Comprehensive Income (HKD Thousands) | Indicator | 2025 (HKD Thousands) | 2024 (HKD Thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Loss for the Period | (50,513) | (594,847) | -91.51% | | Exchange Differences on Translation of Foreign Operations | 50,344 | (28,066) | -279.46% | | Share of Other Comprehensive Income/(Loss) of Associates | 64,883 | (20,592) | -415.08% | | Share of Other Comprehensive Income/(Loss) of Joint Ventures | 119,588 | (358,545) | -133.35% | | Other Comprehensive Income/(Loss) for the Period (Net of Tax) | 240,225 | (494,244) | -148.61% | | Total Comprehensive Income/(Loss) for the Period | 189,712 | (1,089,091) | -117.42% | | Total Comprehensive Income/(Loss) for the Period Attributable to Owners of the Company | 115,874 | (794,999) | -114.58% | [Condensed Consolidated Statement of Financial Position](index=3&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) As of June 30, 2025, the Group's net assets significantly decreased, primarily due to the derecognition of assets and liabilities related to subsidiaries classified as held for distribution following the HKC share distribution, and a corresponding decline in total equity Condensed Consolidated Statement of Financial Position (HKD Thousands) | Indicator | June 30, 2025 (HKD Thousands) | December 31, 2024 (HKD Thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Non-current Assets | 3,139,404 | 3,015,287 | 4.12% | | Current Assets | 576,705 | 702,089 | -17.86% | | Assets Classified as Held for Distribution | - | 9,545,440 | -100.00% | | Current Liabilities | 541,285 | 998,266 | -45.78% | | Liabilities Directly Associated with Assets Classified as Held for Distribution | - | 563,296 | -100.00% | | Non-current Liabilities | 1,544,858 | 1,521,554 | 1.53% | | Net Assets | 1,629,966 | 10,179,700 | -83.99% | | Equity Attributable to Owners of the Company | 805,012 | 6,981,959 | -88.42% | | Non-controlling Interests | 824,954 | 3,197,741 | -74.20% | | Total Equity | 1,629,966 | 10,179,700 | -83.99% | - Net current assets significantly decreased from **HKD 8,685,967 thousand** as of December 31, 2024, to **HKD 35,420 thousand** as of June 30, 2025, primarily due to the reclassification and derecognition of related assets and liabilities following the HKC share distribution[6](index=6&type=chunk) [Notes to the Financial Statements](index=5&type=section&id=%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8%E9%99%84%E8%A8%BB) [1. Basis of Preparation](index=5&type=section&id=%E7%B7%A8%E8%A3%BD%E5%9F%BA%E6%BA%96) This interim report is prepared in accordance with HKAS 34 and Listing Rules disclosure requirements, adopting newly revised HKFRSs with no significant financial impact for the period - This interim report has been prepared in accordance with Hong Kong Accounting Standard 34 and the applicable disclosure requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[8](index=8&type=chunk) - Newly adopted revised Hong Kong Financial Reporting Standards (e.g., HKAS 21 amendment "Lack of Exchangeability") for the period had no significant financial impact on this interim report[9](index=9&type=chunk)[10](index=10&type=chunk) [2. Segment Information](index=6&type=section&id=%E5%88%86%E9%83%A8%E8%B3%87%E6%96%99) The Group's operations are divided into eight segments: property investment, property development, financial investment, securities investment, food business, healthcare services, property management, and others, with varying performance and financial positions, notably the food business as the largest revenue contributor and property investment/joint venture results significantly impacted by the HKC distribution - The Group's operations are divided into eight operating segments: property investment, property development, financial investment, securities investment, food business, healthcare services, property management, and "others"[11](index=11&type=chunk)[14](index=14&type=chunk) Segment Revenue and Results for H1 2025 (HKD Thousands) | Segment | Revenue | Segment Results | | :--- | :--- | :--- | | Property Investment | 17,712 | (4,243) | | Property Development | - | (1,702) | | Financial Investment | 2,271 | 2,271 | | Securities Investment | 4,267 | 5,785 | | Food Business | 392,320 | (2,478) | | Healthcare Services | - | - | | Property Management | 6,221 | 4,942 | | Other | 871 | 39 | | **Consolidated Total** | **421,209** | **4,596** | Segment Assets and Liabilities as of June 30, 2025 (HKD Thousands) | Segment | Segment Assets | Interests in Associates | Interests in Joint Ventures | Segment Liabilities | | :--- | :--- | :--- | :--- | :--- | | Property Investment | 1,126,212 | - | - | 209,219 | | Property Development | 780 | - | - | 645 | | Financial Investment | 148,303 | - | - | - | | Securities Investment | 642,427 | - | 41,736 | 41,989 | | Food Business | 700,821 | - | 37,768 | 324,003 | | Healthcare Services | - | 509,172 | - | 442,517 | | Property Management | 1,031 | - | - | 1,065 | | Other | 4,631 | 371,617 | - | 295,183 | | **Consolidated Total** | **2,618,719** | **880,789** | **79,504** | **326,309** | [3. Revenue](index=9&type=section&id=%E6%94%B6%E5%85%A5) Total revenue for the period increased by 2.73% to HKD 421,209 thousand, primarily driven by growth in food manufacturing and restaurant operations, with the food business accounting for the vast majority of total revenue, while interest and dividend income significantly decreased Revenue Analysis (HKD Thousands) | Revenue Source | 2025 | 2024 | YoY Change (%) | | :--- | :--- | :--- | :--- | | Food Manufacturing Business Revenue | 202,855 | 166,400 | 21.91% | | Restaurant Operations Revenue | 187,787 | 179,479 | 4.63% | | Provision of Management Services | 6,130 | 6,555 | -6.50% | | **Total Revenue from Contracts with Customers** | **396,772** | **352,434** | **12.58%** | | Property Rental Income | 8,955 | 11,491 | -22.07% | | Interest Income | 9,912 | 38,067 | -73.96% | | Dividend Income | 4,094 | 6,835 | -40.09% | | Other | 1,476 | 1,181 | 24.98% | | **Total Revenue from Other Sources** | **24,437** | **57,574** | **-57.56%** | | **Total Revenue** | **421,209** | **410,008** | **2.73%** | - Revenue from contracts with customers primarily originated from **Singapore (HKD 222,956 thousand)** and **Hong Kong (HKD 130,191 thousand)**[20](index=20&type=chunk) [4. Other Losses — Net](index=11&type=section&id=%E5%85%B6%E4%BB%96%E8%99%A7%E6%90%8D%20%E2%80%94%20%E6%B7%A8%E9%A1%8D) Other losses net increased during the period, mainly due to expanded fair value losses on investment properties and increased impairment provisions for inventories, partially offset by a reversal of provisions for loans and receivables Other Losses — Net (HKD Thousands) | Item | 2025 | 2024 | YoY Change (%) | | :--- | :--- | :--- | :--- | | Loss on Disposal of Property, Plant and Equipment | (320) | (150) | 113.33% | | Fair Value Loss on Investment Properties | (8,650) | (5,000) | 73.00% | | Provision for Impairment Loss on Inventories | (836) | (540) | 54.81% | | Reversal of/(Provision for) Impairment Loss on Loans and Receivables | 63 | (1,103) | -105.71% | | Exchange Gains/(Losses) — Net | 124 | (786) | -115.78% | | **Total** | **(9,530)** | **(6,657)** | **43.16%** | [5. Loss Before Tax](index=12&type=section&id=%E9%99%A4%E7%A8%85%E5%89%8D%E8%99%A7%E6%90%8D) Loss before tax significantly narrowed during the period, primarily due to a substantial reduction in net fair value losses on financial instruments at fair value through profit or loss, and a decrease in other operating expenses such as legal and professional fees, and consultancy and service fees Key Components of Loss Before Tax (HKD Thousands) | Item | 2025 | 2024 | YoY Change (%) | | :--- | :--- | :--- | :--- | | Net Fair Value Gains/(Losses) on Financial Instruments at FVTPL | (987) | (51,822) | -98.09% | | Staff Costs | (167,960) | (163,518) | 2.72% | | Depreciation of Property, Plant and Equipment | (29,959) | (34,693) | -13.79% | | Depreciation of Right-of-use Assets | (33,787) | (33,187) | 1.81% | | Selling and Distribution Expenses | (29,554) | (22,163) | 33.36% | | Legal and Professional Fees | (5,824) | (34,153) | -82.99% | | Consultancy and Service Fees | (5,739) | (8,171) | -29.76% | | Cost of Inventories Sold | (154,549) | (141,521) | 9.21% | [6. Share of Results of Joint Ventures](index=12&type=section&id=%E6%89%80%E4%BD%B5%E5%90%88%E7%87%9F%E4%BC%81%E6%A5%AD%E6%A5%AD%E7%B8%BE) The share of results of joint ventures shifted from a significant loss in the prior period to a profit, mainly due to the contribution from Lippo ASM Asia Property Limited (LAAPL), which ceased to be a joint venture of the Company after the HKC share distribution - For the six months ended June 30, 2025, the share of results of joint ventures primarily included a **profit of HKD 41,432 thousand** from Lippo ASM Asia Property Limited (LAAPL), compared to a loss of HKD 430,239 thousand in the same period of 2024[24](index=24&type=chunk) - Following the completion of the HKC share distribution in January 2025, LAAPL ceased to be a joint venture of the Company[24](index=24&type=chunk) [7. Income Tax](index=13&type=section&id=%E6%89%80%E5%BE%97%E7%A8%85) Income tax expense decreased during the period, primarily stemming from tax expenditures in Hong Kong and Mainland China/overseas regions Income Tax Expense (HKD Thousands) | Region | 2025 | 2024 | | :--- | :--- | :--- | | Hong Kong | 398 | 2,842 | | Mainland China and Overseas | 3,345 | 2,287 | | **Total Expense for the Period** | **3,743** | **5,129** | - Hong Kong profits tax is calculated at **8.25% or 16.5%**, while corporate tax rates in Mainland China, Singapore, and Malaysia are **25%, 17%, and 24%**, respectively[26](index=26&type=chunk) [8. Loss Per Share Attributable to Owners of the Company](index=13&type=section&id=%E6%9C%AC%E5%85%AC%E5%8F%B8%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%E8%99%A7%E6%90%8D) Basic and diluted loss per share significantly narrowed during the period, reflecting a reduced loss for the period and the absence of potentially dilutive ordinary shares issued by the Group Loss Per Share (HK cents) | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Basic and Diluted Loss Per Share | (7.8) | (88.6) | - Basic loss per share is calculated based on the consolidated loss for the period attributable to owners of the Company and the weighted average number of approximately **493,154,000 ordinary shares** in issue during the period[27](index=27&type=chunk) - For the six months ended June 30, 2025 and 2024, the Group had no ordinary shares in issue with potential dilutive effects[27](index=27&type=chunk) [9. Interim Dividend](index=13&type=section&id=%E4%B8%AD%E6%9C%9F%E8%82%A1%E6%81%AF) The Board of Directors has resolved not to declare any interim dividend for the six months ended June 30, 2025, consistent with the prior year period - The Directors have resolved not to declare any interim dividend for the six months ended June 30, 2025 (2024 — Nil)[28](index=28&type=chunk) [10. Trade and Other Receivables, Prepayments and Other Assets](index=13&type=section&id=%E6%87%89%E6%94%B6%E8%B3%A6%E6%AC%BE%E3%80%81%E9%A0%90%E4%BB%98%E6%AC%BE%E9%A0%85%E5%8F%8A%E5%85%B6%E4%BB%96%E8%B3%87%E7%94%A2) As of June 30, 2025, total trade receivables increased, with balances within 30 days and 31-60 days accounting for a larger proportion Ageing Analysis of Trade Receivables (HKD Thousands) | Ageing | June 30, 2025 | December 31, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Within 30 days | 37,960 | 35,339 | 7.42% | | 31 to 60 days | 29,501 | 22,548 | 30.84% | | 61 to 90 days | 16,679 | 13,749 | 21.31% | | Over 90 days | 1,653 | 1,115 | 48.25% | | **Total** | **85,793** | **72,751** | **17.92%** | [11. HKC Share Distribution / Assets Classified as Held for Distribution / Liabilities Directly Associated with Assets Classified as Held for Distribution](index=14&type=section&id=HKC%20%E8%82%A1%E4%BB%BD%E5%88%86%E6%B4%BE%E5%8F%8A%E7%9B%B8%E9%97%9C%E8%B3%87%E7%94%A2%E8%B2%A0%E5%82%B5) The Company completed the HKC share distribution in January 2025, resulting in the derecognition of HKC Group's assets and liabilities as it ceased to be a subsidiary, and a reduction of **HKD 6,329,256 thousand** in equity attributable to owners of the Company - The Company completed the distribution in specie of **1,193,432,757 shares** of Hongkong Chinese Limited (HKC) to its shareholders in January 2025, reducing the Company's interest in HKC from **73.95% to 14.23%**[30](index=30&type=chunk)[31](index=31&type=chunk) - Following the completion of the HKC share distribution, the HKC Group ceased to be a subsidiary of the Company, and its assets and liabilities were derecognized[31](index=31&type=chunk)[32](index=32&type=chunk) Impact of HKC Share Distribution on Equity (HKD Thousands) | Item | 2025 | | :--- | :--- | | Net Assets Derecognized | 6,702,964 | | Special Interim Distribution Payable for HKC Share Distribution Derecognized | (304,325) | | HKC Shares Retained by the Group Recognized | (72,492) | | Transaction Costs of HKC Share Distribution | 3,109 | | **Decrease in Equity Attributable to Owners of the Company** | **6,329,256** | [12. Bank and Other Borrowings](index=16&type=section&id=12.%20%E9%8A%80%E8%A1%8C%E5%8F%8A%E5%85%B6%E4%BB%96%E8%B2%B8%E6%AC%BE) The Group's total bank and other borrowings slightly decreased, with secured bank loans forming the largest portion and collateralized by various assets, while unsecured bank loans are related to a privatization proposal with some restricted funds Bank and Other Borrowings (HKD Thousands) | Loan Type | June 30, 2025 | December 31, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Current Portion: Bank Loans — Secured | 206,977 | 311,554 | -33.69% | | Non-current Portion: Bank Loans — Secured | 571,122 | 604,304 | -5.50% | | Non-current Portion: Bank Loans — Unsecured | 73,056 | - | N/A | | Non-current Portion: Other Loans — Unsecured | 790,000 | 790,000 | 0.00% | | **Total** | **1,641,155** | **1,705,858** | **-3.80%** | - Bank loans bear interest at annual rates ranging from **0.8% to 6.4%** (December 31, 2024: 5.0% to 7.3%)[34](index=34&type=chunk) - Bank loans are secured by investment properties, land and buildings, financial assets at fair value through profit or loss, and shares in a listed associate[37](index=37&type=chunk) - Restricted cash of **HKD 71,251 thousand** (December 31, 2024 — Nil) is solely for funding the cash consideration for shareholders electing cash distribution and paying related distribution costs[35](index=35&type=chunk) [13. Trade and Other Payables, Accruals and Other Liabilities](index=17&type=section&id=13.%20%E6%87%89%E4%BB%98%E8%B3%A6%E6%AC%BE%E3%80%81%E6%87%89%E8%A8%88%E6%AC%BE%E9%A0%85%E5%8F%8A%E5%85%B6%E4%BB%96%E8%B2%A0%E5%82%B5) As of June 30, 2025, total trade payables decreased, primarily due to the settlement of the special interim distribution payable related to the HKC share distribution in January Ageing Analysis of Trade Payables (HKD Thousands) | Ageing | June 30, 2025 | December 31, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Within 30 days | 26,539 | 27,003 | -1.69% | | 31 to 60 days | 8,112 | 13,186 | -38.50% | | 61 to 90 days | 444 | 3,794 | -88.29% | | Over 90 days | 648 | 483 | 34.16% | | **Total** | **35,743** | **44,466** | **-19.62%** | - The **HKD 340,128 thousand** special interim distribution payable for the HKC share distribution included in trade payables as of December 31, 2024, was settled in January 2025[36](index=36&type=chunk) [14. Share Capital](index=18&type=section&id=14.%20%E8%82%A1%E6%9C%AC) The Company's issued share capital remained unchanged, but a capital reduction effective July 29, 2025, transferred an amount from the share capital account to the capital reduction reserve account to offset accumulated losses Issued and Fully Paid Share Capital (HKD Thousands) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | 493,154,032 Ordinary Shares | 986,598 | 986,598 | - The Company announced a capital reduction in May 2025, reducing the amount credited to the share capital account to **HKD 50,000 thousand**, effective July 29, 2025, generating a credit of **HKD 934,440 thousand** transferred to the capital reduction reserve account to offset accumulated losses[39](index=39&type=chunk) [15. Events After Reporting Period](index=18&type=section&id=15.%20%E5%A0%B1%E5%91%8A%E6%9C%9F%E5%BE%8C%E4%BA%8B%E9%A0%85) Post-reporting period events include the effective capital reduction and a privatization proposal involving the Company's privatization via a scheme of arrangement and a special distribution of Lippo China Resources shares, expected to be effective in September 2025 with delisting - The Company's capital reduction became effective on **July 29, 2025**[40](index=40&type=chunk) - LL Capital Holdings Limited proposed a privatization, including the privatization of the Company via a scheme of arrangement (cash consideration of **HKD 0.14 per share**) and a special distribution of Lippo China Resources shares (shareholders can choose shares or cash)[40](index=40&type=chunk) - The privatization proposal is expected to become effective on **September 23, 2025**, with the delisting of shares from the Hong Kong Stock Exchange after 4:00 p.m. on **September 25, 2025**[40](index=40&type=chunk) [Business Review and Outlook](index=19&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7%E8%88%87%E5%B1%95%E6%9C%9B) [Overview](index=19&type=section&id=%E6%A6%82%E8%A7%80) Global economic performance was mixed in H1 2025, with Hong Kong's economy expanding steadily but facing a weak property market and challenging food retail, while Singapore's economy continued to grow despite global trade headwinds and tariff uncertainties - Global economic performance was mixed in the first half of 2025, with the Hong Kong economy expanding steadily in Q2 but facing a weak property market and challenging food retail business[41](index=41&type=chunk) - The Singapore economy continued its growth, increasing by **4.4%** in Q2 2025, despite ongoing global trade headwinds and US tariff uncertainties[41](index=41&type=chunk) [Results for the Period](index=19&type=section&id=%E6%9C%9F%E5%85%A7%E6%A5%AD%E7%B8%BE) The consolidated loss attributable to owners of the Company significantly narrowed to **HKD 39,000 thousand** for the period, mainly due to the derecognition of the HKC Group and reduced net fair value losses on financial instruments at fair value through profit or loss, with the food business remaining the primary revenue source, achieving a **13% revenue increase** Consolidated Loss Attributable to Owners of the Company (HKD Thousands) | Period | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Consolidated Loss | (39,000) | (437,000) | - The narrowed loss was primarily due to the derecognition of the HKC Group after January 2025 and a reduction in net fair value losses on financial instruments at fair value through profit or loss recorded by the Group during the period[42](index=42&type=chunk) - Revenue for the period increased to **HKD 421,000 thousand** (2024 — HKD 410,000 thousand), with **55% from Singapore** and **32% from Hong Kong**[43](index=43&type=chunk) - Food business revenue increased by **13%**, accounting for **93%** of total revenue for the period (2024 — 85%)[43](index=43&type=chunk) - Other operating expenses decreased to **HKD 79,000 thousand** (2024 — HKD 105,000 thousand), mainly due to reduced legal and professional fees[43](index=43&type=chunk) [Food Business](index=20&type=section&id=%E9%A3%9F%E5%93%81%E6%A5%AD%E5%8B%99) Food business revenue grew to **HKD 392,000 thousand** during the period, primarily from food manufacturing and restaurant operations; Singapore and Malaysia operations improved, but the Hong Kong market faced challenges from declining consumption and outbound travel, leading to a segment loss Food Business Revenue and Results (HKD Thousands) | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Revenue | 392,000 | 348,000 | | Segment Loss | (2,000) | (20,000) | - Food manufacturing revenue increased by **22%**, and restaurant operations revenue increased by **5%**[44](index=44&type=chunk) - The Group operates restaurants under the brands "Chatterbox Café", "Délifrance", "alfafa", and "Lippo Huen"[44](index=44&type=chunk) - Food manufacturing businesses in Singapore and Malaysia showed improved performance, but the operating environment for the food business in Hong Kong remained challenging due to declining consumption and residents traveling to the Greater Bay Area or overseas for short trips[44](index=44&type=chunk) [Property Investment](index=20&type=section&id=%E7%89%A9%E6%A5%AD%E6%8A%95%E8%B3%87) Property investment segment revenue decreased during the period, mainly due to the derecognition of the HKC Group after the HKC share distribution; fair value losses on investment properties expanded, resulting in a segment loss, while the share of results of joint ventures turned from loss to profit, primarily from LAAPL Property Investment Segment Revenue and Results (HKD Thousands) | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Total Segment Revenue | 18,000 | 45,000 | | Fair Value Loss on Investment Properties | (9,000) | (5,000) | | Segment Loss/(Profit) Before Share of Results of Joint Ventures | (4,000) | 10,000 | | Share of Joint Ventures Profit/(Loss) | 41,000 | (433,000) | - The decrease in revenue was primarily due to the derecognition of the HKC Group after the HKC share distribution, resulting in no further contributions from the HKC Group[45](index=45&type=chunk) - The expanded fair value loss on investment properties was mainly due to a decline in the market value of Hong Kong properties[45](index=45&type=chunk) - The share of joint ventures profit primarily came from a **HKD 41,000 thousand profit** from Lippo ASM Asia Property Limited (LAAPL), which ceased to be a joint venture of the Company after the HKC share distribution[45](index=45&type=chunk) [Financial and Securities Investments](index=20&type=section&id=%E8%B2%A1%E5%8B%99%E5%8F%8A%E8%AD%89%E5%88%B8%E6%8A%95%E8%B3%87) Total revenue from financial and securities investments decreased during the period, but a net fair value gain was recorded, turning the segment from a loss to a profit; the total value of the investment portfolio declined, primarily comprising financial assets at fair value through profit or loss and at fair value through other comprehensive income Financial and Securities Investment Performance (HKD Thousands) | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Total Revenue | 7,000 | 11,000 | | Net Fair Value Gains/(Losses) | 2,000 | (52,000) | | Segment Profit/(Loss) | 8,000 | (42,000) | Financial and Securities Investment Portfolio (HKD Thousands) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Value | 791,000 | 1,008,000 | | Cash and Bank Balances | 156,000 | 450,000 | | Financial Assets at Fair Value Through Profit or Loss | 496,000 | 496,000 | | Financial Assets at Fair Value Through Other Comprehensive Income | 127,000 | 46,000 | [Financial Assets at Fair Value Through Profit or Loss](index=21&type=section&id=%E6%8C%89%E5%85%AC%E5%B9%B3%E5%80%BC%E8%A8%88%E5%85%A5%E6%90%8D%E7%9B%8A%E4%B9%8B%E8%B2%A1%E5%8B%99%E8%B3%87%E7%94%A2) The Group's total assets in this category amounted to **HKD 496,000 thousand**, primarily consisting of equity securities, debt securities, and investment funds, with GSH equity securities recording unrealized fair value gains, and Amasia CIV and Quantedge funds showing varied performance Composition of Financial Assets at Fair Value Through Profit or Loss (HKD Thousands) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Equity Securities | 113,000 | 102,000 | | Debt Securities | 17,000 | 20,000 | | Investment Funds | 366,000 | 374,000 | | **Total** | **496,000** | **496,000** | Key Financial Assets at Fair Value Through Profit or Loss (HKD Thousands) | Investment Item | Fair Value as of June 30, 2025 | Fair Value as of December 31, 2024 | Net Fair Value Gains/(Losses) for H1 2025 | | :--- | :--- | :--- | :--- | | GSH Corporation Limited | 76,326 | 63,254 | 13,072 | | Amasia CIV T, L.P. | 56,419 | 55,814 | 582 | | Quantedge Global Fund | 40,681 | 44,551 | 147 | | Other | 322,534 | 332,054 | (14,283) | | **Total** | **495,960** | **495,673** | **(482)** | - GSH Corporation Limited equity securities recorded an unrealized fair value gain of **HKD 13,000 thousand**, benefiting from positive factors in Malaysia's tourism and real estate markets[50](index=50&type=chunk) - Amasia CIV, a single portfolio fund investing in AI communications intelligence platform Dialpad, recorded a fair value gain of **HKD 582 thousand** for the Group during the period[51](index=51&type=chunk) - The Group redeemed **HKD 4,000 thousand** of Quantedge investment during the period and recorded an unrealized fair value gain of **HKD 100 thousand**[52](index=52&type=chunk) [Financial Assets at Fair Value Through Other Comprehensive Income](index=22&type=section&id=%E6%8C%89%E5%85%AC%E5%B9%B3%E5%80%BC%E8%A8%88%E5%85%A5%E5%85%B6%E4%BB%96%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E4%B9%8B%E8%B2%A1%E5%8B%99%E8%B3%87%E7%94%A2) The carrying value of these assets increased to **HKD 127,000 thousand**, primarily due to the reclassification of the Group's retained HKC interest after the HKC share distribution, with other key investments including GenieBiome Holdings Limited (GB) and H2G Green Limited (H2G) - As of June 30, 2025, the carrying value of financial assets at fair value through other comprehensive income increased to **HKD 127,000 thousand** (December 31, 2024 — HKD 46,000 thousand), mainly due to the retained HKC interest being reclassified as such assets after the HKC share distribution[53](index=53&type=chunk) - The Group's investment in HKC had a fair value of **HKD 77,000 thousand**, accounting for approximately **60.4%** of the total value of these assets, and recorded an unrealized fair value gain of **HKD 4,000 thousand**[53](index=53&type=chunk) - The investment in GenieBiome Holdings Limited (GB) had a fair value of **HKD 24,000 thousand**, recorded an unrealized fair value gain of **HKD 300 thousand** during the period, and contributed dividend income[54](index=54&type=chunk) - The investment in H2G Green Limited (H2G) had a fair value of **HKD 13,000 thousand**, recorded an unrealized fair value gain of **HKD 3,000 thousand** during the period, and H2G listed warrants recorded a fair value gain of **HKD 2,000 thousand**[55](index=55&type=chunk) [Healthcare Services](index=23&type=section&id=%E9%86%AB%E7%99%82%E4%BF%9D%E5%81%A5%E6%9C%8D%E5%8B%99) The Group holds a **40.8% interest** in Healthway Medical Corporation Limited, which maintained revenue growth during the period, primarily from its general practice and specialist segments, with the Group recognizing a **HKD 100 thousand share of profit** - The Group holds a **40.8% interest** in Healthway Medical Corporation Limited (Healthway), which operates a network of over **130 clinics**[56](index=56&type=chunk) - The Healthway Group maintained revenue growth during the period, primarily from its general practice and specialist segments, as well as revenue contributions from its day surgery centers[56](index=56&type=chunk) Share of Healthway Group Results (HKD Thousands) | Period | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Share of Profit/(Loss) | 100 | (3,000) | - As of June 30, 2025, the Group's interest in Healthway was **HKD 509,000 thousand** (December 31, 2024 — HKD 470,000 thousand)[56](index=56&type=chunk) [Other Businesses](index=24&type=section&id=%E5%85%B6%E4%BB%96%E6%A5%AD%E5%8B%99) The Group holds a **39.9% interest** in TIH Limited, which primarily engages in investment and fund management; during the period, the Group recorded a share of loss from its TIH investment, reflecting the impact of macroeconomic headwinds on private equity investment activities - The Company owns a **39.9% interest** in TIH Limited (TIH), whose group primarily has two segments: investment business and fund management[57](index=57&type=chunk) Share of TIH Group Results (HKD Thousands) | Period | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Share of Loss/(Profit) | (4,000) | 13,000 | - Private equity investment activities were hampered by macroeconomic headwinds such as tariff fluctuations, prolonged regulatory processes, and heightened geopolitical tensions, leading to extended holding periods and a greater focus on liquidity management[57](index=57&type=chunk) - As of June 30, 2025, the Group's interest in TIH was **HKD 326,000 thousand** (December 31, 2024 — HKD 310,000 thousand)[57](index=57&type=chunk) [Capital Reduction](index=24&type=section&id=%E8%82%A1%E6%9C%AC%E5%89%8A%E6%B8%9B) The Company proposed a capital reduction in May 2025, reducing the amount credited to the share capital account from **HKD 984,440,426.08** to **HKD 50,000,000.00**, effective July 29, 2025, to enhance corporate activity flexibility and offset accumulated losses - The Company proposed to reduce the amount credited to the share capital account from **HKD 984,440,426.08** to **HKD 50,000,000.00** to enhance flexibility for corporate activities and the ability to declare distributions or dividends[58](index=58&type=chunk) - The capital reduction became effective on **July 29, 2025**, generating a credit of **HKD 934,440,426.08** transferred to the capital reduction reserve account to offset part of the accumulated losses[58](index=58&type=chunk) [Proposal (Privatization)](index=24&type=section&id=%E5%BB%BA%E8%AD%B0) LL Capital Holdings Limited proposed a privatization, including the Company's privatization via a scheme of arrangement (cash consideration of **HKD 0.14 per share**) and a special distribution of Lippo China Resources shares; this proposal is subject to conditions and is expected to be effective in September 2025 with delisting - LL Capital Holdings Limited requested the Board to put forward a privatization proposal to shareholders, with a consideration of **HKD 0.14 cash per scheme share**[59](index=59&type=chunk) - The proposal also includes a distribution in specie to shareholders of up to **303,289,730 Lippo China Resources shares** (approximately **33.01%** of total issued shares), with shareholders having the option to receive shares or cash[59](index=59&type=chunk) - The proposal remains subject to the fulfillment or waiver of the scheme conditions and distribution conditions, and is expected to become effective on **September 23, 2025**, with the delisting of shares from the Hong Kong Stock Exchange after 4:00 p.m. on **September 25, 2025**[59](index=59&type=chunk) [Financial Position](index=25&type=section&id=%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81) As of June 30, 2025, the Group's total assets remained at **HKD 3,700,000 thousand** (excluding HKC Group), total liabilities decreased to **HKD 2,100,000 thousand**, and total bank and other borrowings slightly declined, while the capital gearing ratio significantly increased to **177.1%**, primarily due to the HKC share distribution Financial Position Overview (HKD Thousands) | Indicator | June 30, 2025 | December 31, 2024 (Excluding HKC Group) | | :--- | :--- | :--- | | Total Assets | 3,700,000 | 3,700,000 | | Total Liabilities | 2,100,000 | 2,500,000 | | Bank and Other Borrowings | 1,641,000 | 1,706,000 | | Consolidated Net Assets Attributable to Owners of the Company | 805,000 | 6,982,000 | | Net Assets Per Share (HKD) | 1.6 | 14.2 | - The decrease in total liabilities was mainly due to the non-cash settlement of the special interim distribution payable upon completion of the HKC share distribution in January 2025[60](index=60&type=chunk) - The capital gearing ratio (calculated as bank and other borrowings as per the consolidated statement of financial position (net of non-controlling interests) to equity attributable to owners of the Company) significantly increased from **21.3%** as of December 31, 2024, to **177.1%** as of June 30, 2025[62](index=62&type=chunk) - The Group monitors foreign exchange positions and uses hedging instruments to manage foreign exchange risk; as of June 30, 2025, total capital commitments were **HKD 82,000 thousand**, primarily related to committed investments in unlisted investment funds[63](index=63&type=chunk)[64](index=64&type=chunk) [Staff and Remuneration](index=26&type=section&id=%E5%93%A1%E5%B7%A5%E8%88%87%E8%96%AA%E9%85%AC) As of June 30, 2025, the Group's number of full-time employees slightly decreased, while staff costs slightly increased, with the Group offering competitive remuneration packages and benefits Staff Data (HKD Thousands) | Indicator | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Number of Full-time Employees | 851 | 856 | | Staff Costs | 168,000 | 164,000 | - The Group provides benefits such as medical insurance and provident funds to employees to maintain competitiveness[65](index=65&type=chunk) [Outlook](index=26&type=section&id=%E5%B1%95%E6%9C%9B) Global growth is projected at **3.0%** for 2025, with Hong Kong's economy and food retail expected to benefit from tourism promotion, and Singapore's economy outperforming expectations; however, uncertainties like rising tariffs and geopolitical tensions pose downside risks, requiring the Group to prudently manage its business and finances - Global growth is projected at **3.0%** for 2025, slightly higher than previous forecasts, mainly due to lower average tariff rates in the US, a weaker US dollar, and fiscal expansion in some major economies[66](index=66&type=chunk) - Hong Kong's economy and food retail business may benefit from the government's active promotion of tourism and major events[66](index=66&type=chunk) - Singapore's Ministry of Trade and Industry revised its 2025 GDP growth forecast upwards to **1.5% to 2.5%**, reflecting better-than-expected economic performance in the first half[66](index=66&type=chunk) - Uncertainties such as rising tariffs and heightened geopolitical tensions continue to pose downside risks, potentially disrupting global trade, supply chains, and driving up inflation[66](index=66&type=chunk) - The Group and its associates will continue to prudently manage their businesses, monitor assets and investments, and carefully manage funds in a challenging operating environment[66](index=66&type=chunk) [Corporate Governance and Other Information](index=26&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%8F%8A%E5%85%B6%E4%BB%96%E4%BF%A1%E6%81%AF) [Purchase, Sale or Redemption of the Company's Listed Securities](index=26&type=section&id=%E8%B3%BC%E8%B2%B7%E3%80%81%E5%87%BA%E5%94%AE%E6%88%96%E8%B4%96%E5%9B%9E%E6%9C%AC%E5%85%AC%E5%8F%B8%E4%B9%8B%E4%B8%8A%E5%B8%82%E8%AD%89%E5%88%B8) During the six months ended June 30, 2025, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - During the six months ended June 30, 2025, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[68](index=68&type=chunk) [Audit Committee](index=27&type=section&id=%E5%AF%A9%E6%A0%B8%E5%A7%94%E5%93%A1%E6%9C%83) The Company's Audit Committee, comprising two independent non-executive directors and one non-executive director, has reviewed the Group's accounting principles, practices, and interim financial report - The current members of the Audit Committee include Mr. Yung Hon Kwong (Chairman), Mr. Tsui King Fai (both independent non-executive directors), and Mr. Chan Nim Leung (non-executive director)[69](index=69&type=chunk) - The Committee has reviewed the accounting principles and practices adopted by the Group and financial reporting matters, including the unaudited condensed consolidated interim financial report for the six months ended June 30, 2025[69](index=69&type=chunk) [Corporate Governance](index=27&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB) The Company is committed to high-quality corporate governance practices and complied with the Corporate Governance Code during the period, except for the Chairman of the Board being unable to attend the AGM due to being overseas, with the Vice Chairman presiding - The Company complied with the code provisions of the Corporate Governance Code as set out in Appendix C1 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited for the six months ended June 30, 2025, except for the Chairman of the Board being unable to attend the Annual General Meeting[70](index=70&type=chunk) - The Chairman of the Board was unable to attend the Company's Annual General Meeting held on June 23, 2025, due to being overseas, and the Vice Chairman of the Board presided as chairman[70](index=70&type=chunk) - The Company's Board of Directors comprises nine directors, including four executive directors, two non-executive directors, and three independent non-executive directors[70](index=70&type=chunk)

Company Information [Company Basic Information and Governance Structure](index=5&type=section&id=Company%20Basic%20Information%20and%20Governance%20Structure) This section outlines Yik Wo International Holdings Limited's board members, committee compositions, compliance officer, authorized representatives, company secretary, auditor, principal bankers, registered office, and principal places of business - The Board of Directors includes Executive Directors Mr. Xu Youjiang (Chairman), Ms. Xu Liping, Mr. Zhang Yuansheng; and Independent Non-executive Directors Mr. Zhang Shize, Mr. Liu Dajin, Mr. Yang Jie[14](index=14&type=chunk) - Mr. Yang Jie was appointed as an Independent Non-executive Director, Chairman of the Remuneration Committee, and a member of the Nomination/Audit Committee on June 26, 2025, while Mr. Deng Zhihuang resigned on the same day[14](index=14&type=chunk)[60](index=60&type=chunk) - The Company's Compliance Officer and Authorized Representative is Mr. Xu Youjiang, and the Company Secretary is Ms. Lei Meijia[14](index=14&type=chunk) - The auditor is Grant Thornton Hong Kong Limited[15](index=15&type=chunk) - The Company's registered office is in the Cayman Islands, its principal place of business in China is in Jinjiang City, Fujian Province, and its principal place of business in Hong Kong is in Kwun Tong, Kowloon[16](index=16&type=chunk) - The Company's stock code is **8659**, and its website is www.yikwo.cn[16](index=16&type=chunk) Management Discussion and Analysis [Business Review and Outlook](index=7&type=section&id=Business%20Review%20and%20Outlook) The Group primarily engages in the design, development, production, and sale of disposable plastic fast-food boxes in China, alongside the development and operation of mobile applications and e-commerce platforms - The Group's main businesses are the design, development, production, and sale of disposable plastic fast-food boxes, and the development and operation of mobile applications and e-commerce platforms[18](index=18&type=chunk) - For the six months ended June 30, 2025, the Group's revenue decreased, primarily due to weak market demand for disposable plastic fast-food boxes[19](index=19&type=chunk) - Directors believe the popularization of environmentally friendly fast-food boxes, advancements in production technology, and competition from alternatives will impact the Group's future development, focusing on product safety, environmental protection, brand promotion, expanding sales channels, and product customization[20](index=20&type=chunk) - The Group completed the acquisition of 100% equity in Yizhen Film and Television for **RMB 20,571,430** on April 27, 2022, aiming to capitalize on opportunities in China's film industry[21](index=21&type=chunk) - The Group acquired 100% equity in Beijing Youpin Hui on June 1, 2022, and launched the "Yik Wo Tian Xia" e-commerce platform in July 2022, selling daily necessities, cosmetics, home appliances, and agricultural products[22](index=22&type=chunk) - On January 21, 2025, the Group signed a memorandum of understanding for the potential acquisition of a **30% equity stake** in strategic supplier Zhenpin Network, aiming to expand revenue streams and stabilize the e-commerce platform's supply chain[23](index=23&type=chunk) [Financial Review](index=8&type=section&id=Financial%20Review) For the six months ended June 30, 2025, the Group's revenue, gross profit, and profit for the period all recorded significant declines, mainly due to reduced sales orders for disposable plastic fast-food boxes and decreased e-commerce segment revenue Financial Performance (RMB thousands) | Indicator | June 30, 2025 (RMB thousands) | June 30, 2024 (RMB thousands) | Change (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenue | 109,517 | 155,828 | (46,311) | (29.7%) | | Cost of sales | (78,326) | (109,627) | 31,301 | (28.6%) | | Gross profit | 31,191 | 46,201 | (15,010) | (32.5%) | | Selling expenses | (6,220) | (8,850) | 2,630 | (30.3%) | | Administrative and other operating expenses | (12,471) | (12,734) | 263 | (1.6%) | | Finance costs | (86) | (140) | 54 | (38.6%) | | Income tax expense | (4,102) | (6,992) | 2,890 | (41.3%) | | Profit for the period | 8,951 | 18,765 | (9,814) | (52.3%) | - Overall gross profit margin decreased from **29.6%** in the same period of 2024 to **28.5%** in 2025[27](index=27&type=chunk) - Administrative and other operating expenses decreased primarily due to reduced staff costs[29](index=29&type=chunk) - Income tax expense decreased mainly due to lower profit for the period, calculated at China's enterprise income tax rate of **25%**[31](index=31&type=chunk) [GEM Listing and Proposed Transfer of Listing](index=9&type=section&id=GEM%20Listing%20and%20Proposed%20Transfer%20of%20Listing) The Company's shares were listed on GEM of the Stock Exchange on July 13, 2020. An application for transfer to the Main Board was submitted on May 31, 2023, which lapsed automatically after six months, and a new application was filed on May 9, 2024, under the simplified transfer mechanism - The Company's shares were listed on GEM of the Stock Exchange on July 13, 2020, raising a net amount of **HKD 22.8 million** (approximately **RMB 20.4 million**) through a share offer[33](index=33&type=chunk) - The GEM to Main Board transfer application submitted on May 31, 2023, has automatically lapsed[33](index=33&type=chunk) - The Company formally resubmitted an application to the Stock Exchange on May 9, 2024, for transfer to the Main Board under Chapter 9B of the Main Board Listing Rules using the simplified transfer mechanism[34](index=34&type=chunk) [Liquidity and Financial Resources](index=10&type=section&id=Liquidity%20and%20Financial%20Resources) As of June 30, 2025, the Group's net current assets, current ratio, and cash position all improved, primarily due to a reduction in trade and other payables and net cash generated from operating activities Liquidity and Financial Resources (RMB millions) | Indicator | June 30, 2025 (RMB millions) | December 31, 2024 (RMB millions) | Change (RMB millions) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Net current assets | 261.5 | 247.7 | 13.8 | 5.6% | | Current ratio | 8.7 | 6.1 | 2.6 | 42.6% | | Gearing ratio | 11.5% | 16.1% | (4.6%) | (28.6%) | | Bank balances and cash | 213.9 | 206.1 | 7.8 | 3.8% | - The increase in net current assets was mainly due to a decrease in trade and other payables[35](index=35&type=chunk) - The increase in bank balances and cash was primarily attributable to net cash generated from operating activities[37](index=37&type=chunk) - As of June 30, 2025, and December 31, 2024, the Group had no borrowings[38](index=38&type=chunk) - Lease liabilities decreased from approximately **RMB 4.2 million** as of December 31, 2024, to approximately **RMB 2.8 million** as of June 30, 2025[39](index=39&type=chunk) [Capital Structure](index=10&type=section&id=Capital%20Structure) Since its GEM listing, the Group's capital structure has not undergone significant changes, with equity solely comprising ordinary shares - From GEM listing to June 30, 2025, the Group's capital structure has not undergone significant changes, with share capital consisting solely of ordinary shares[40](index=40&type=chunk) - As of June 30, 2025, the issued share capital was approximately **HKD 7.5 million**, with **748,482,760** ordinary shares issued (par value of **HKD 0.01** per share)[40](index=40&type=chunk)[115](index=115&type=chunk) - The Group has consideration payable of approximately **RMB 6.2 million**, representing promissory notes issued for the acquisition of 100% equity in Yizhen Film and Television, which are interest-free and repayable upon the film's release[40](index=40&type=chunk)[114](index=114&type=chunk) [Segment Information](index=10&type=section&id=Segment%20Information) The Directors have categorized the Group's operations into two operating segments: (i) design, development, production, and sale of disposable plastic fast-food boxes; and (ii) operation of mobile applications and e-commerce platforms - The Group has two operating segments: disposable plastic fast-food box business and mobile application and e-commerce platform business[41](index=41&type=chunk) [Future Plans for Material Investments and Capital Assets](index=10&type=section&id=Future%20Plans%20for%20Material%20Investments%20and%20Capital%20Assets) As of June 30, 2025, the Group had no plans for any material investments and capital assets - As of June 30, 2025, the Group had no plans for any material investments and capital assets[42](index=42&type=chunk) [Material Investments, Acquisitions, and Disposals of Subsidiaries](index=11&type=section&id=Material%20Investments%2C%20Acquisitions%2C%20and%20Disposals%20of%20Subsidiaries) For the six months ended June 30, 2025, the Group did not undertake any material investments, acquisitions, or disposals that would constitute discloseable transactions under the GEM Listing Rules - During the reporting period, the Group did not undertake any material investments, acquisitions, or disposals that would constitute discloseable transactions under the GEM Listing Rules[44](index=44&type=chunk) [Pledge of Group Assets](index=11&type=section&id=Pledge%20of%20Group%20Assets) As of June 30, 2025, the Group had no pledge of any assets - As of June 30, 2025, the Group had no pledge of any assets[45](index=45&type=chunk) [Contingent Liabilities](index=11&type=section&id=Contingent%20Liabilities) As of June 30, 2025, the Group had no contingent liabilities - As of June 30, 2025, the Group had no contingent liabilities[46](index=46&type=chunk) [Exchange Rate Fluctuation Risk](index=11&type=section&id=Exchange%20Rate%20Fluctuation%20Risk) The Group primarily operates in China, with most transactions settled in RMB, thus incurring no significant foreign exchange risk during the year and not employing any financial instruments for hedging - The Group primarily operates in China, with transactions settled in RMB, thus incurring no significant foreign exchange risk during the year[47](index=47&type=chunk) - For the six months ended June 30, 2025, the Group did not use any financial instruments for hedging purposes[47](index=47&type=chunk) [Employees and Remuneration Policy](index=11&type=section&id=Employees%20and%20Remuneration%20Policy) As of June 30, 2025, the Group's total number of employees was 192, a decrease from 203 as of December 31, 2024 Employee Information and Costs | Indicator | June 30, 2025 | December 31, 2024 | Change | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Total number of employees | 192 persons | 203 persons | (11 persons) | (5.4%) | | Staff costs (RMB millions) | 9.6 | 9.7 | (0.1) | (1.0%) | - Remuneration is determined with reference to fixed salaries and an appraisal system as the basis for salary reviews and promotion decisions[48](index=48&type=chunk) [Disclosure of Interests](index=12&type=section&id=Disclosure%20of%20Interests) This section discloses the long positions of Directors and Chief Executives, as well as substantial shareholders, in the Company's shares [Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares, and Debentures](index=12&type=section&id=Directors%27%20and%20Chief%20Executive%27s%20Interests%20and%20Short%20Positions%20in%20Shares%2C%20Underlying%20Shares%2C%20and%20Debentures) As of June 30, 2025, Director Mr. Xu Youjiang directly and through controlled corporations held a total long position of 50.23% in the Company's shares, with his spouse Ms. Xu Liping also deemed to hold the same percentage due to spousal interest Directors' Interests in Shares | Director Name | Capacity/Nature of Interest | Number and Class of Securities | Long/Short Position | Approximate Percentage | | :--- | :--- | :--- | :--- | :--- | | Mr. Xu Youjiang | Interest in controlled corporation | 301,500,000 ordinary shares | Long position | 40.28% | | | Beneficial owner | 74,482,760 ordinary shares | Long position | 9.95% | | | **Total** | **375,982,760 ordinary shares** | **Long position** | **50.23%** | | Ms. Xu Liping | Spouse's interest | 375,982,760 ordinary shares | Long position | 50.23% | [Substantial Shareholders' and Other Persons' Interests and Short Positions in Shares, Underlying Shares, and Debentures](index=13&type=section&id=Substantial%20Shareholders%27%20and%20Other%20Persons%27%20Interests%20and%20Short%20Positions%20in%20Shares%2C%20Underlying%20Shares%2C%20and%20Debentures) As of June 30, 2025, substantial shareholders included Prize Investment Limited (40.28%), Mr. Xu Youjiang (9.95%), Merit Winner Limited (9.02%), Mr. Xu Wenjie (9.02%), Ms. Xu Meiya (9.02%), Youpin Hui Investment (8.55%), and Mr. Hu Kun (8.55%) Substantial Shareholders' Interests in Shares | Name | Capacity | Number and Class of Securities | Long/Short Position | Approximate Percentage | | :--- | :--- | :--- | :--- | :--- | | Prize Investment Limited | Beneficial owner | 301,500,000 ordinary shares | Long position | 40.28% | | Mr. Xu Youjiang | Beneficial owner | 74,482,760 ordinary shares | Long position | 9.95% | | | **Total** | **375,982,760 ordinary shares** | **Long position** | **50.23%** | | Merit Winner Limited | Beneficial owner | 67,500,000 ordinary shares | Long position | 9.02% | | Mr. Xu Wenjie | Interest in controlled corporation | 67,500,000 ordinary shares | Long position | 9.02% | | Ms. Xu Meiya | Spouse's interest | 67,500,000 ordinary shares | Long position | 9.02% | | Youpin Hui Investment | Beneficial owner | 64,000,000 ordinary shares | Long position | 8.55% | | Mr. Hu Kun | Interest in controlled corporation | 64,000,000 ordinary shares | Long position | 8.55% | [Competition and Conflicts of Interest](index=14&type=section&id=Competition%20and%20Conflicts%20of%20Interest) For the six months ended June 30, 2025, none of the Directors, controlling shareholders, or their associates owned any business or interest that competed or might compete with the Group's business, nor were there any other conflicts of interest - During the reporting period, none of the Directors, controlling shareholders, or their associates owned any business or interest that constituted or might constitute competition with the Group's business, nor were there any other conflicts of interest[53](index=53&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=14&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company%27s%20Listed%20Securities) For the six months ended June 30, 2025, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - During the reporting period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[54](index=54&type=chunk) [Corporate Governance Code](index=14&type=section&id=Corporate%20Governance%20Code) The Company has consistently complied with the applicable code provisions of the Corporate Governance Code set out in Appendix C1 to the GEM Listing Rules - The Company has consistently complied with the applicable code provisions of the Corporate Governance Code set out in Appendix C1 to the GEM Listing Rules[55](index=55&type=chunk) - The roles of Chairman (Mr. Xu Youjiang) and Chief Executive Officer (Ms. Xu Liping) are segregated and performed by different individuals[55](index=55&type=chunk) [Directors' Securities Transactions](index=14&type=section&id=Directors%27%20Securities%20Transactions) The Group has adopted a code of conduct for Directors' securities transactions, with terms no less stringent than those required by the GEM Listing Rules - The Group has adopted a code of conduct for Directors' securities transactions, and there were no breaches during the reporting period[56](index=56&type=chunk) [Dividends](index=14&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 any interim dividend for the six months ended June 30, 2025 (2024: RMB zero)[57](index=57&type=chunk) [Share Option Scheme](index=14&type=section&id=Share%20Option%20Scheme) As of June 30, 2025, the Company had no share option scheme - As of June 30, 2025, the Company had no share option scheme[58](index=58&type=chunk) [Material Events After Reporting Period](index=15&type=section&id=Material%20Events%20After%20Reporting%20Period) The Board is not aware of any material events requiring disclosure that have occurred from June 30, 2025, up to the date of this report - The Board is not aware of any material events requiring disclosure that have occurred from June 30, 2025, up to the date of this report[59](index=59&type=chunk) [Changes in Directors' Information](index=15&type=section&id=Changes%20in%20Directors%27%20Information) Mr. Yang Jie was appointed as an Independent Non-executive Director, Chairman of the Remuneration Committee, and a member of the Nomination/Audit Committee on June 26, 2025 - Mr. Yang Jie was appointed as an Independent Non-executive Director, Chairman of the Remuneration Committee, and a member of the Nomination/Audit Committee on June 26, 2025[60](index=60&type=chunk) [Audit Committee](index=15&type=section&id=Audit%20Committee) The Audit Committee comprises three independent non-executive Directors, with Mr. Zhang Shize as Chairman - The Audit Committee comprises three independent non-executive Directors (Mr. Zhang Shize, Mr. Liu Dajin, Mr. Yang Jie), with Mr. Zhang Shize serving as Chairman[61](index=61&type=chunk) - The Audit Committee's primary responsibilities include reviewing and overseeing financial reporting, audit processes, internal control procedures, and corporate governance[61](index=61&type=chunk) - The Audit Committee has reviewed the Group's unaudited condensed consolidated financial statements for the six months ended June 30, 2025[62](index=62&type=chunk) Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=16&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the six months ended June 30, 2025, the Group's revenue was RMB 109,517 thousand, a 29.7% decrease from RMB 155,828 thousand in the prior year. Profit for the period was RMB 8,951 thousand, a significant 52.3% decrease from RMB 18,765 thousand in the prior year. Basic and diluted earnings per share were RMB 1.20 cents Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (RMB thousands) | Indicator | June 30, 2025 (RMB thousands) | June 30, 2024 (RMB thousands) | Change (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenue | 109,517 | 155,828 | (46,311) | (29.7%) | | Gross profit | 31,191 | 46,201 | (15,010) | (32.5%) | | Operating profit | 13,139 | 25,897 | (12,758) | (49.3%) | | Profit before income tax | 13,053 | 25,757 | (12,704) | (49.3%) | | Profit for the period | 8,951 | 18,765 | (9,814) | (52.3%) | | Total comprehensive income for the period | 8,953 | 18,802 | (9,849) | (52.4%) | | Basic and diluted earnings per share | RMB 1.20 cents | RMB 2.51 cents | (RMB 1.31 cents) | (52.2%) | Condensed Consolidated Statement of Financial Position [Condensed Consolidated Statement of Financial Position](index=17&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group's net assets were RMB 297,398 thousand, an increase from RMB 288,445 thousand as of December 31, 2024. Net current assets increased to RMB 261,546 thousand, primarily due to a reduction in trade and other payables Condensed Consolidated Statement of Financial Position (RMB thousands) | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Non-current assets | 37,773 | 42,947 | (5,174) | (12.0%) | | Current assets | 295,688 | 296,300 | (612) | (0.2%) | | Current liabilities | 34,142 | 48,593 | (14,451) | (29.7%) | | Net current assets | 261,546 | 247,707 | 13,839 | 5.6% | | Total assets less current liabilities | 299,319 | 290,654 | 8,665 | 3.0% | | Non-current liabilities | 1,921 | 2,209 | (288) | (13.0%) | | Net assets | 297,398 | 288,445 | 8,953 | 3.1% | | Total equity | 297,398 | 288,445 | 8,953 | 3.1% | - Net current assets increased primarily due to a decrease in trade and other payables[35](index=35&type=chunk)[65](index=65&type=chunk) Condensed Consolidated Statement of Changes in Equity [Condensed Consolidated Statement of Changes in Equity](index=18&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) For the six months ended June 30, 2025, the Group's total equity increased from RMB 288,445 thousand at the beginning of the period to RMB 297,398 thousand, mainly attributable to profit for the period of RMB 8,951 thousand and an increase in exchange reserve of RMB 2 thousand Condensed Consolidated Statement of Changes in Equity (RMB thousands) | Indicator | June 30, 2025 (RMB thousands) | January 1, 2024 (RMB thousands) | Change (RMB thousands) | | :--- | :--- | :--- | :--- | | Total equity at beginning of period | 288,445 | 261,179 | 27,266 | | Profit for the period | 8,951 | 18,765 | (9,814) | | Other comprehensive income (exchange differences) | 2 | 37 | (35) | | Total equity at end of period | 297,398 | 279,981 | 17,417 | - The increase in total equity was mainly contributed by profit for the period of **RMB 8,951 thousand**[66](index=66&type=chunk) Condensed Consolidated Statement of Cash Flows [Condensed Consolidated Statement of Cash Flows](index=19&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) For the six months ended June 30, 2025, the Group's net increase in cash and cash equivalents was RMB 7,713 thousand, with an ending balance of RMB 213,863 thousand Condensed Consolidated Statement of Cash Flows (RMB thousands) | Indicator | June 30, 2025 (RMB thousands) | June 30, 2024 (RMB thousands) | Change (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Net cash generated from operating activities | 11,783 | 7,617 | 4,166 | 54.7% | | Net cash used in investing activities | (2,531) | (2,400) | (131) | (5.5%) | | Net cash used in financing activities | (1,539) | (1,697) | 158 | 9.3% | | Net increase in cash and cash equivalents | 7,713 | 3,520 | 4,193 | 119.1% | | Cash and cash equivalents at end of period | 213,863 | 168,790 | 45,073 | 26.7% | - Net cash generated from operating activities significantly increased by **54.7%** year-on-year, reaching **RMB 11,783 thousand**[68](index=68&type=chunk) Notes to the Interim Financial Report [1. General Information](index=20&type=section&id=1.%20General%20Information) Yik Wo International Holdings Limited, incorporated in the Cayman Islands, primarily engages in the design, development, production, and sale of disposable plastic fast-food boxes in China, and the operation of e-commerce platforms selling daily necessities and other household products - The Company was incorporated in the Cayman Islands on December 13, 2018, with primary businesses in disposable plastic fast-food boxes and e-commerce platform operations[69](index=69&type=chunk) - The Group's ultimate controlling party is Mr. Xu Youjiang[70](index=70&type=chunk) [2. Basis of Preparation](index=20&type=section&id=2.%20Basis%20of%20Preparation) The condensed consolidated interim financial information is prepared in accordance with the GEM Listing Rules of the Stock Exchange of Hong Kong Limited and Hong Kong Accounting Standard 34, presented in RMB thousands, and is unaudited - The condensed consolidated interim financial information is prepared in accordance with the GEM Listing Rules and Hong Kong Accounting Standard 34, and is unaudited[71](index=71&type=chunk)[72](index=72&type=chunk) - The financial information is presented in **RMB thousands** and was approved for publication by the Board of Directors on August 28, 2025[72](index=72&type=chunk) [3. Significant Accounting Policies](index=20&type=section&id=3.%20Significant%20Accounting%20Policies) The condensed consolidated interim financial statements adopt the same accounting policies as the consolidated financial statements for the year ended December 31, 2024, and have adopted new and revised Hong Kong Financial Reporting Standards effective from January 1, 2025, with no material impact on current period results or financial position - The financial statements adopt the same accounting policies as the 2024 annual consolidated financial statements and have adopted new and revised Hong Kong Financial Reporting Standards effective from January 1, 2025[73](index=73&type=chunk)[74](index=74&type=chunk) - The adoption of new and revised Hong Kong Financial Reporting Standards has no material impact on the preparation and presentation of the results and financial position for the current and prior periods[75](index=75&type=chunk) [4. Estimates and Judgements](index=21&type=section&id=4.%20Estimates%20and%20Judgements) The preparation of the condensed consolidated interim financial information involves management making accounting judgements, estimates, and assumptions, where actual results may differ from these estimates - The preparation of financial information involves management making accounting judgements, estimates, and assumptions, and actual results may differ from these estimates[77](index=77&type=chunk) - The key sources of significant judgements and estimation uncertainties applied are the same as those used in the preparation of the 2024 annual consolidated financial statements[77](index=77&type=chunk) [5. Segment Information](index=21&type=section&id=5.%20Segment%20Information) The Group has two operating segments: disposable plastic fast-food boxes and e-commerce - The chief operating decision-maker has identified the Group's two main product and service lines as operating segments: disposable plastic fast-food boxes and e-commerce[78](index=78&type=chunk) Segment Performance for the Six Months Ended June 30, 2025 (RMB thousands) | Segment | Revenue (RMB thousands) | Segment Results (RMB thousands) | | :--- | :--- | :--- | | Disposable plastic fast-food boxes | 108,278 | 15,984 | | E-commerce | 1,239 | (2,013) | | **Total** | **109,517** | **13,971** | Segment Performance for the Six Months Ended June 30, 2024 (RMB thousands) | Segment | Revenue (RMB thousands) | Segment Results (RMB thousands) | | :--- | :--- | :--- | | Disposable plastic fast-food boxes | 143,720 | 27,236 | | E-commerce | 12,108 | 1,123 | | **Total** | **155,828** | **28,359** | - The e-commerce segment recorded a loss of **RMB 2,013 thousand** in the first half of 2025, compared to a profit of **RMB 1,123 thousand** in the same period last year[80](index=80&type=chunk) [6. Revenue](index=23&type=section&id=6.%20Revenue) The Group's revenue is entirely derived from China, primarily from disposable plastic fast-food boxes and non-branded e-commerce products [Disaggregation of Revenue from Contracts with Customers](index=24&type=section&id=Disaggregation%20of%20Revenue%20from%20Contracts%20with%20Customers) Revenue primarily originates from "Jazz Rabbit" branded products, non-branded disposable plastic fast-food boxes, and non-branded e-commerce products Revenue Disaggregation (RMB thousands) | Brand/Nature | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | **Brand:** | | | | | | "Jazz Rabbit" branded products | 97,644 | 133,038 | (35,394) | (26.6%) | | Non-branded products | 10,634 | 10,682 | (48) | (0.4%) | | Disposable plastic fast-food boxes | 108,278 | 143,720 | (35,442) | (24.7%) | | Non-branded e-commerce | 1,239 | 12,108 | (10,869) | (89.8%) | | **Total Revenue** | **109,517** | **155,828** | **(46,311)** | **(29.7%)** | | **Nature:** | | | | | | Regular products | 67,570 | 123,119 | (55,549) | (45.1%) | | Customized products | 39,740 | 18,904 | 20,836 | 110.2% | - Revenue from customized products increased by **110.2%** year-on-year, indicating growing market demand for personalized products[84](index=84&type=chunk) [Geographical Information](index=25&type=section&id=Geographical%20Information) For the six months ended June 30, 2025 and 2024, all of the Group's revenue and non-current assets were located in China - The Group's revenue and non-current assets are entirely located in China[85](index=85&type=chunk) [7. Other Income](index=25&type=section&id=7.%20Other%20Income) For the six months ended June 30, 2025, other income was RMB 639 thousand, a decrease from RMB 1,280 thousand in the prior year, primarily including bank interest income and interest income related to film production investments Other Income (RMB thousands) | Category | June 30, 2025 (RMB thousands) | June 30, 2024 (RMB thousands) | Change (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Bank interest income | 94 | 155 | (61) | (39.4%) | | Interest income (Note 16) | 514 | 514 | 0 | 0.0% | | Others | 31 | 611 | (580) | (95.0%) | | **Total** | **639** | **1,280** | **(641)** | **(50.1%)** | - Other income decreased by **50.1%** year-on-year, mainly due to a significant reduction in the "Others" category income[86](index=86&type=chunk) [8. Finance Costs](index=25&type=section&id=8.%20Finance%20Costs) For the six months ended June 30, 2025, finance costs were approximately RMB 86 thousand, primarily from interest expenses on lease arrangements, a decrease from RMB 140 thousand in the prior year Finance Costs (RMB thousands) | Category | June 30, 2025 (RMB thousands) | June 30, 2024 (RMB thousands) | Change (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Interest expense on lease arrangements | 86 | 140 | (54) | (38.6%) | [9. Profit Before Income Tax](index=26&type=section&id=9.%20Profit%20Before%20Income%20Tax) Profit before income tax is arrived at after deducting depreciation, amortization of intangible assets, cost of inventories, research and development costs, loss on disposal of property, plant and equipment, transfer of listing and related expenses, and staff costs Profit Before Income Tax Adjustments (RMB thousands) | Item | June 30, 2025 (RMB thousands) | June 30, 2024 (RMB thousands) | Change (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Depreciation | 6,131 | 7,047 | (916) | (13.0%) | | Amortization of intangible assets | 1,304 | 1,533 | (229) | (14.9%) | | Cost of inventories recognized as expense | 66,537 | 86,711 | (20,174) | (23.3%) | | Research and development costs | 5,461 | 4,960 | 501 | 10.1% | | Loss on disposal of property, plant and equipment | 364 | 31 | 333 | 1074.2% | | Transfer of listing and related expenses | 1,371 | 983 | 388 | 39.5% | | Staff costs | 9,577 | 9,669 | (92) | (1.0%) | - Research and development costs increased by **10.1%** year-on-year, indicating increased investment in technological innovation by the Group[88](index=88&type=chunk) - Loss on disposal of property, plant and equipment significantly increased from **RMB 31 thousand** to **RMB 364 thousand**[88](index=88&type=chunk) [10. Income Tax Expense](index=26&type=section&id=10.%20Income%20Tax%20Expense) The Company did not generate assessable profits, thus no provision for profits tax was made. Income tax expense primarily arises from Chinese subsidiaries, calculated at the applicable tax rate of 25%, amounting to RMB 4,102 thousand for the six months ended June 30, 2025, a 41.4% decrease year-on-year - The Company did not generate assessable profits, thus no provision for profits tax was made[89](index=89&type=chunk) - China enterprise income tax is provided at an applicable tax rate of **25%** on the assessable profits of the Company's Chinese subsidiaries[90](index=90&type=chunk) Income Tax Expense (RMB thousands) | Category | June 30, 2025 (RMB thousands) | June 30, 2024 (RMB thousands) | Change (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Provision for China enterprise income tax | 4,102 | 6,992 | (2,890) | (41.3%) | [11. Dividends](index=27&type=section&id=11.%20Dividends) The Directors do not recommend the payment of an interim dividend for the six months ended June 30, 2025 - The Directors do not recommend the payment of an interim dividend for the six months ended June 30, 2025 (2024: nil)[92](index=92&type=chunk) [12. Earnings Per Share](index=27&type=section&id=12.%20Earnings%20Per%20Share) For the six months ended June 30, 2025, basic and diluted earnings per share were RMB 1.20 cents, a decrease from RMB 2.51 cents in the prior year Earnings Per Share (RMB thousands, except per share data) | Indicator | June 30, 2025 | June 30, 2024 | Change | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Profit for the period attributable to equity holders of the Company | 8,951 | 18,765 | (9,814) | (52.3%) | | Number of ordinary shares (thousands) | 748,483 | 748,483 | 0 | 0.0% | | Basic and diluted earnings per share | RMB 1.20 cents | RMB 2.51 cents | (RMB 1.31 cents) | (52.2%) | - Diluted earnings per share are equal to basic earnings per share as there were no potential ordinary shares issued[94](index=94&type=chunk) [13. Property, Plant and Equipment](index=27&type=section&id=13.%20Property%2C%20Plant%20and%20Equipment) During the interim period, the Group incurred approximately RMB 2,625 thousand for the acquisition of property, plant and equipment and disposed of certain plant and equipment with a total carrying amount of RMB 364 thousand, resulting in a loss on disposal Property, Plant and Equipment Activities (RMB thousands) | Item | June 30, 2025 (RMB thousands) | June 30, 2024 (RMB thousands) | Change (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Purchase of property, plant and equipment | 2,625 | 2,555 | 70 | 2.7% | | Carrying amount of property, plant and equipment disposed | 364 | 31 | 333 | 1074.2% | | Loss on disposal | 364 | 31 | 333 | 1074.2% | - Loss on disposal of property, plant and equipment significantly increased, reflecting potential challenges in asset disposal[95](index=95&type=chunk) [14. Lease Liabilities](index=28&type=section&id=14.%20Lease%20Liabilities) As of June 30, 2025, the Group's total lease liabilities amounted to RMB 2,788 thousand, a decrease from RMB 4,241 thousand as of December 31, 2024 Lease Liabilities (RMB thousands) | Category | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Current lease liabilities | 867 | 2,032 | (1,165) | (57.3%) | | Non-current lease liabilities | 1,921 | 2,209 | (288) | (13.0%) | | **Total** | **2,788** | **4,241** | **(1,453)** | **(34.3%)** | - The decrease in lease liabilities reflects the repayment or expiry of some lease agreements[96](index=96&type=chunk) - Lease agreements with Hengsheng Toys (controlled by Mr. Xu Wenjie, brother of controlling shareholder Mr. Xu Youjiang) have a three-year term, renewable for three years, up to a maximum of twenty years[96](index=96&type=chunk)[97](index=97&type=chunk) [15. Intangible Assets](index=30&type=section&id=15.%20Intangible%20Assets) As of June 30, 2025, the Group's net book value of intangible assets was RMB 2,399 thousand, a decrease from RMB 3,703 thousand as of December 31, 2024 Intangible Assets (RMB thousands) | Category | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Mobile application development costs | 335 | 1,151 | (816) | (70.9%) | | Specialized technical patents | 2,064 | 2,552 | (488) | (19.1%) | | Trademarks | 0 | 0 | 0 | 0.0% | | **Total** | **2,399** | **3,703** | **(1,304)** | **(35.2%)** | - The decrease in net book value of intangible assets was mainly due to the amortization of mobile application development costs and specialized technical patents[99](index=99&type=chunk) [16. Financial Assets at Fair Value Through Profit or Loss](index=30&type=section&id=16.%20Financial%20Assets%20at%20Fair%20Value%20Through%20Profit%20or%20Loss) As of June 30, 2025, the Group's financial assets at fair value through profit or loss amounted to RMB 20,416 thousand, primarily investments in film production - As of June 30, 2025, investments in film production amounted to **RMB 20,416 thousand**, classified as financial assets at fair value through profit or loss[100](index=100&type=chunk)[103](index=103&type=chunk)[106](index=106&type=chunk) - The acquisition of Yizhen Film and Television (the film project owner) has been completed and includes a profit guarantee[101](index=101&type=chunk)[104](index=104&type=chunk)[105](index=105&type=chunk) - Mr. Xu Youjiang agreed to pay a penalty interest of **5% per annum** on the investment amount, with **RMB 514 thousand** accrued and recognized as other income for the six months ended June 30, 2025[105](index=105&type=chunk) - Directors expect the film to be released in 2025[105](index=105&type=chunk) [17. Inventories](index=31&type=section&id=17.%20Inventories) As of June 30, 2025, the Group's total inventories amounted to RMB 9,628 thousand, a slight increase from RMB 9,106 thousand as of December 31, 2024, mainly due to an increase in finished goods Inventories (RMB thousands) | Category | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Raw materials | 3,889 | 4,966 | (1,077) | (21.7%) | | Finished goods | 5,739 | 4,140 | 1,599 | 38.6% | | **Total** | **9,628** | **9,106** | **522** | **5.7%** | - Finished goods inventory increased by **38.6%**, while raw materials inventory decreased by **21.7%**[106](index=106&type=chunk) [18. Trade and Other Receivables](index=32&type=section&id=18.%20Trade%20and%20Other%20Receivables) As of June 30, 2025, the Group's total trade and other receivables amounted to RMB 51,781 thousand, a decrease from RMB 60,635 thousand as of December 31, 2024 Trade and Other Receivables (RMB thousands) | Category | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Trade receivables | 48,228 | 59,975 | (11,747) | (19.6%) | | Prepayments and other receivables | 3,553 | 660 | 2,893 | 438.3%) | | **Total** | **51,781** | **60,635** | **(8,854)** | **(14.6%)** | [Trade Receivables](index=32&type=section&id=Trade%20Receivables) Trade receivables are based on invoice dates, with a typical credit period of 60 days Aging Analysis of Trade Receivables (RMB thousands) | Aging | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Within 30 days | 17,666 | 31,552 | (13,886) | (44.0%) | | 31 to 60 days | 22,318 | 27,628 | (5,310) | (19.2%) | | 61 to 90 days | 8,244 | 795 | 7,449 | 937.0% | | **Total** | **48,228** | **59,975** | **(11,747)** | **(19.6%)** | - The credit period for trade receivables is typically **60 days**[108](index=108&type=chunk) - Overdue trade receivables aged **61-90 days** significantly increased by **937.0%**, indicating a potential rise in collection risk[109](index=109&type=chunk) [19. Cash and Cash Equivalents](index=33&type=section&id=19.%20Cash%20and%20Cash%20Equivalents) As of June 30, 2025, the Group's bank balances and cash amounted to approximately RMB 213,725 thousand, primarily held in banks in China - As of June 30, 2025, bank balances and cash amounted to **RMB 213,725 thousand**, primarily held in Chinese banks[111](index=111&type=chunk) - RMB is not a freely convertible currency, and its remittance out of China is subject to foreign exchange control rules[111](index=111&type=chunk) [20. Trade and Other Payables](index=33&type=section&id=20.%20Trade%20and%20Other%20Payables) As of June 30, 2025, the Group's total trade and other payables amounted to RMB 31,295 thousand, a significant decrease from RMB 43,155 thousand as of December 31, 2024 Trade and Other Payables (RMB thousands) | Category | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Trade payables | 17,126 | 27,865 | (10,739) | (38.5%) | | Accrued expenses and other payables | 14,169 | 15,290 | (1,121) | (7.3%) | | **Total** | **31,295** | **43,155** | **(11,860)** | **(27.5%)** | - Trade payables significantly decreased by **38.5%**, reflecting payments to suppliers or reduced purchasing activities[112](index=112&type=chunk) - Consideration payable amounted to **RMB 6,171 thousand**, representing promissory notes issued for the acquisition of 100% equity in Yizhen Film and Television, which are interest-free and repayable upon the film's release[114](index=114&type=chunk) [Trade Payables](index=34&type=section&id=Trade%20Payables) The credit period granted by suppliers to the Group ranges from 30 to 60 days Aging Analysis of Trade Payables (RMB thousands) | Aging | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Within 30 days | 15,089 | 18,089 | (3,000) | (16.6%) | | 31 to 60 days | 2,037 | 9,776 | (7,739) | (79.2%) | | **Total** | **17,126** | **27,865** | **(10,739)** | (38.5%) | - Suppliers grant the Group credit periods ranging from **30 to 60 days**[113](index=113&type=chunk) [21. Share Capital](index=35&type=section&id=21.%20Share%20Capital) As of June 30, 2025, the Company's authorized share capital consisted of 5,000,000,000 ordinary shares, with 748,482,760 ordinary shares issued and fully paid, each with a par value of HKD 0.01 Share Capital (RMB thousands) | Category | Number of Shares | Amount (RMB thousands) | | :--- | :--- | :--- | | Authorized share capital | 5,000,000,000 | 45,147 | | Issued and fully paid share capital | 748,482,760 | 6,667 | - The par value of the Company's ordinary shares is **HKD 0.01** per share[115](index=115&type=chunk) [22. Related Party Transactions](index=35&type=section&id=22.%20Related%20Party%20Transactions) The Group had key management personnel remuneration transactions with related parties during the period [Key Management Personnel Remuneration](index=35&type=section&id=Key%20Management%20Personnel%20Remuneration) For the six months ended June 30, 2025, total key management personnel remuneration was RMB 488 thousand, largely consistent with RMB 486 thousand in the prior year Key Management Personnel Remuneration (RMB thousands) | Category | June 30, 2025 (RMB thousands) | June 30, 2024 (RMB thousands) | Change (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Salaries, allowances and benefits | 479 | 477 | 2 | 0.4% | | Retirement scheme contributions | 9 | 9 | 0 | 0.0% | | **Total** | **488** | **486** | **2** | **0.4%** |

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。 China Uptown Group Company Limited 中國上城集團有限公 司 （於開曼群島註冊成立之有限公司） （股份代號﹕2330） 截至二零二五年六月三十日止六個月之中期業績 中國上城集團有限公司（「本公司」）之董事（「董事」）會（「董事會」）宣佈本公司 及其附屬公司（統稱為「本集團」）截至二零二五年六月三十日止六個月（「本期 間」）之未經審核簡明綜合中期業績，連同二零二四年同期的比較未經審核數 字如下。本期間的未經審核簡明綜合財務資料尚未經審計，惟已經由本公司 審核委員會（「審核委員會」）審閱。 簡明綜合損益表 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 | 人民幣千元 | 人民幣千元 | | | | （未經審核） （未經審核） | | ...

香港交易及結算所有限公司及香港聯合交易所有限公司（「聯交所」）對本公告的 內容概不負責，對其準確性或完整性亦不發表任何聲明，並明確表示，概不對因本 公告全部或任何部分內容而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 Sundy Service Group Co. Ltd 宋都服务集团有限公司 （ 於 開 曼 群 島 註 冊 成 立 的 有 限 公 司 ） （股份代號：9608） 截至2025年6月30日止六個月中期業績公告 宋都服务集团有限公司（「本公司」）董事（「董事」）會（「董事會」）欣然宣佈本公 司及其附屬公司（統稱「本集團」）截至2025年6月30日止六個月（「期內」）之未經 審核綜合業績，連同2024年同期的比較數字。本集團期內之業績已經本公司審核委 員會（「審核委員會」）審閱並經董事會於2025年8月28日批准。 本公告所載若干金額及百分比數字已約整或已四捨五入至小數點後一位或兩位數。 任何表格、圖表或其他地方所示總額與所列數額總和如有任何差異乃因四捨五入 所致。 – 1 – 業績摘要 本集團的財務業績 – 2 – • 期內，本集團實現收入人民幣116.5百萬元，較2024年同期收入人民幣 ...

（於香港註冊成立之有限公司） （股份代號：156） 中期業績 截至 2025 年 6 月 30 日止六個月 力寶華潤有限公司（「本公司」）之董事會公佈本公司及其附屬公司（統稱「本集團」）截至 2025 年 6 月 30 日 止六個月之未經審核綜合中期業績，連同 2024 年同期之比較數字如下： 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佈之內容概不負責，對其準確性或完整性亦不發表任何聲 明，並明確表示，概不對因本公佈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。 LIPPO CHINA RESOURCES LIMITED 力 寶 華 潤 有 限 公 司 簡明綜合損益表 截至 2025 年 6 月 30 日止六個月 | | | 未經審核 | | | --- | --- | --- | --- | | | | 截至 6 月 30 日止六個月 | | | | | 2025 年 | 2024 年 | | | 附註 | 千港元 | 千港元 | | 收入 | 3 | 412,108 | 374,147 | | 銷售成本 | | (155,432) | (142,651) | | | | ...

Financial Performance - In the first half of 2025, the group's revenue was approximately RMB 279.7 million, a decrease of 3.3% compared to RMB 289.4 million in the first half of 2024[2]. - The group recorded a net profit of approximately RMB 1.0 million in the first half of 2025, compared to a net loss of RMB 0.2 million in the same period of 2024[2]. - Basic and diluted earnings per share attributable to ordinary shareholders were RMB 0.04 in the first half of 2025, compared to a loss of RMB 0.01 in the first half of 2024[2]. - The gross profit for the first half of 2025 was RMB 6.4 million, down from RMB 9.8 million in the first half of 2024, reflecting a gross margin decrease[3]. - Total comprehensive income for the period attributable to the company’s owners was RMB 956,000, compared to a loss of RMB 183,000 in the first half of 2024[5]. - The pre-tax profit for the six months ended June 30, 2025, was RMB 4,035 thousand, a significant increase from RMB 179 thousand in the previous year[13][15]. - The company reported a total of RMB 11,304 thousand in other income and gains for the period, contributing positively to overall financial performance[13]. - Other income and gains totaled RMB 11,304,000 for the six months ended June 30, 2025, compared to RMB 6,030,000 in 2024, marking an increase of approximately 87%[19]. - The company's revenue decreased due to a decline in production and sales, despite a slight increase in steel trading revenue[38]. Revenue Breakdown - High-grade iron ore sales contributed RMB 45,827 thousand, accounting for 16.0% of total revenue, down from 18.0% in the previous year[16]. - Steel trading generated RMB 224,013 thousand, representing 80.0% of total revenue, slightly down from 79.0% in the prior year[16]. - Facility management services brought in RMB 9,827 thousand, maintaining a 4.0% share of total revenue, consistent with the previous year[16]. - The iron ore business generated revenue of RMB 45,827,000, down from RMB 50,751,000 in 2024, reflecting a decrease of about 10%[18]. - Steel trading revenue was RMB 224,013,000, compared to RMB 228,770,000 in 2024, indicating a decrease of approximately 2%[18]. - Facility management services contributed RMB 10,547,000, an increase from RMB 10,371,000 in 2024, showing a growth of about 2%[18]. Assets and Liabilities - The group's total assets less current liabilities amounted to RMB 1,136.0 million as of June 30, 2025, compared to RMB 1,065.5 million as of December 31, 2024[6]. - Non-current liabilities increased to RMB 212.8 million as of June 30, 2025, from RMB 145.3 million as of December 31, 2024[7]. - Total assets as of June 30, 2025, amounted to RMB 1,293,040 thousand, a slight decrease from RMB 1,298,310 thousand as of June 30, 2024[14][15]. - Total liabilities stood at RMB 369,858 thousand, compared to RMB 358,182 thousand in the previous year, indicating an increase of 3.7%[14][15]. - As of June 30, 2025, the group's accounts receivable amounted to RMB 149,436,000, a significant increase from RMB 75,494,000 as of December 31, 2024, representing a growth of 97.5%[31]. - The group's accounts payable as of June 30, 2025, totaled RMB 56,812,000, a decrease from RMB 63,585,000 as of December 31, 2024, reflecting a decline of 10.5%[32]. - The total bank and other borrowings as of June 30, 2025, were RMB 77,180,000, down from RMB 91,444,000 as of December 31, 2024, indicating a reduction of 15.6%[32]. Cash Flow and Expenditures - The net cash flow from operating activities for the first half of 2025 was approximately RMB 9.9 million, down from RMB 22.3 million in the same period of 2024[60]. - The net cash flow used in investing activities was approximately RMB 1.8 million, a decrease from RMB 22.9 million in the first half of 2024, primarily due to capital expenditures related to the upgrade and expansion of high-grade iron ore operations[61]. - The net cash flow used in financing activities was approximately RMB 17.7 million, compared to RMB 7.3 million in the first half of 2024, mainly due to repayments of bank loans[62]. - Capital expenditures for the six months ended June 30, 2025, were RMB 11,413 thousand, up from RMB 8,670 thousand in the same period of 2024[13][15]. Dividends and Shareholder Information - The board did not recommend the payment of an interim dividend for the first half of 2025, consistent with the previous year[2]. - The company's issued and fully paid ordinary shares remained at 2,249,015,410 as of June 30, 2025, unchanged from December 31, 2024[33]. - The company did not recommend any interim dividend for the first half of 2025, consistent with the previous year[24]. Economic and Market Conditions - The construction steel consumption in China decreased by 6.1% year-on-year in the first half of 2025, reflecting ongoing pressure in the steel industry due to a sluggish real estate sector[35]. - The China Steel Price Index (CSPI) fell from 96.09 points in January 2025 to 90.10 points in June 2025, marking a decline of 6.23% in the first half of 2025 and a year-on-year decrease of 14.14%[35]. - The iron ore price index reached a peak of 886.86 in February 2025 but fell to 770.76 by June 2025, with expectations of further decline in the second half of 2025 due to reduced production and weak demand[36]. - The overall China Purchasing Managers' Index (PMI) showed a slight increase, peaking at 51.4% in March 2025, but fell to 50.2% in April and stabilized at 50.7% in June 2025, indicating gradual expansion in production and business activities[36]. - The steel industry PMI was at 45.9% in June 2025, reflecting a year-on-year decline of 1.9 percentage points, highlighting ongoing challenges within the industry[36]. Corporate Governance and Compliance - The company has complied with all applicable corporate governance codes during the reporting period[93]. - The financial data disclosed complies with the listing rules and has been prepared according to applicable accounting standards[95]. - The company has not purchased, sold, or redeemed any of its listed securities during the reporting period[94]. Employee and Operational Updates - As of June 30, 2025, the company had 326 employees, down from 356 on December 31, 2024, with employee benefits expenses amounting to RMB 17.1 million in H1 2025, compared to RMB 14.4 million in H1 2024[92]. - The company has adopted a performance-based compensation policy, which includes salaries, housing allowances, retirement contributions, and discretionary bonuses linked to performance[92]. - The facilities management division is expected to play an increasingly important role in diversifying revenue sources amid growing competition in the industry[90]. Guarantees and Financial Obligations - The company has provided a maximum guarantee amount of RMB 930.0 million under the 2025 main guarantee agreement, effective from January 1, 2025, to December 31, 2027[75]. - The company's total capital expenditure increased by approximately RMB 2.7 million to about RMB 11.4 million, primarily due to costs associated with the resource integration process of the Maoling-Yanglongshan iron ore project[87]. - The total loan amount owed by the company is approximately RMB 930.0 million, including principal, accumulated interest, penalties, and other associated costs[102]. - The maximum guarantee amount under the China Titanium Guarantee is RMB 690.0 million as of June 30, 2025, down from RMB 730.0 million[102].

Financial Highlights [Financial Highlights](index=1&type=section&id=Financial%20Highlights) Despite a **17.6% revenue decrease**, the Group significantly narrowed its **loss for the period by 56.1%** through enhanced operational management and cost control Financial Performance Summary (RMB thousand) | Metric | 2025 (RMB thousand) | 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 313,217 | 379,943 | (17.6)% | | - Diagnostic testing services for medical alliances | 180,333 | 182,272 | (1.1)% | | - Diagnostic outsourcing services | 118,491 | 179,614 | (34.0)% | | - Diagnostic testing services for non-medical institutions | 14,393 | 18,057 | (20.3)% | | Cost of Revenue | (206,848) | (251,745) | (17.8)% | | Gross Profit | 106,369 | 128,198 | (17.0)% | | Loss Before Income Tax | (55,409) | (131,775) | (58.0)% | | Loss for the Period | (55,359) | (126,055) | (56.1)% | | Loss Attributable to Owners of the Company | (55,340) | (126,129) | (56.1)% | Loss Per Share (RMB) | Metric | 2025 (RMB) | 2024 (RMB) | Change (%) | | :--- | :--- | :--- | :--- | | Loss Per Share (Basic) Attributable to Owners of the Company | (0.09) | (0.21) | (57.1)% | | Loss Per Share (Diluted) Attributable to Owners of the Company | (0.09) | (0.21) | (57.1)% | - The Group's overall revenue decline was primarily influenced by factors such as centralized procurement, medical insurance cost control, and intensified industry competition[5](index=5&type=chunk) - The significant narrowing of loss was mainly attributable to continuous improvements in operational and management capabilities, strengthened cost control, reduced selling and administrative expenses, optimized debt structure, substantial reduction in finance costs, and decreased impairment provisions for assets[6](index=6&type=chunk) Condensed Consolidated Financial Statements [Condensed Consolidated Statement of Comprehensive Income](index=3&type=section&id=Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) For the six months ended June 30, 2025, the Group recorded a **loss for the period of RMB 55.4 million**, significantly narrowed from **RMB 126.1 million** in the prior year, driven by reduced operating expenses and finance costs Condensed Consolidated Statement of Comprehensive Income (RMB thousand) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue | 313,217 | 379,943 | | Cost of Revenue | (206,848) | (251,745) | | Gross Profit | 106,369 | 128,198 | | Selling Expenses | (53,096) | (89,945) | | Administrative Expenses | (78,272) | (99,706) | | Net Impairment Loss on Financial Assets | (8,352) | (52,447) | | Other Income - Net | 31,822 | 6,590 | | Operating Loss | (40,263) | (107,517) | | Finance Costs - Net | (15,146) | (24,258) | | Loss Before Income Tax | (55,409) | (131,775) | | Loss for the Period | (55,359) | (126,055) | - Loss attributable to owners of the Company decreased from **RMB 126,129 thousand** in 2024 to **RMB 55,340 thousand** in 2025[10](index=10&type=chunk) - Both basic and diluted loss per share decreased from **RMB (0.21)** in 2024 to **RMB (0.09)** in 2025[10](index=10&type=chunk) [Condensed Consolidated Statement of Financial Position](index=5&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group's **net assets totaled RMB 1,102.5 million**, slightly down from December 31, 2024, with improved liquidity driven by a greater reduction in current liabilities Condensed Consolidated Statement of Financial Position (RMB thousand) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Non-current Assets | 570,295 | 568,885 | | Current Assets | 2,490,119 | 2,659,451 | | Current Liabilities | 1,712,571 | 1,916,435 | | Net Current Assets | 777,548 | 743,016 | | Non-current Liabilities | 245,356 | 162,024 | | Net Assets | 1,102,487 | 1,149,877 | | Equity | 1,102,487 | 1,149,877 | - Financial assets at fair value through profit or loss increased by **RMB 92.2 million to RMB 567.6 million**, primarily due to increased private equity investments and fair value fluctuations[78](index=78&type=chunk) - Trade receivables decreased by **RMB 31.3 million to RMB 597.1 million**, mainly due to partial collections and impairment provisions[80](index=80&type=chunk) - Reduced borrowings and trade and other payables within current liabilities led to an increase in net current assets[86](index=86&type=chunk) Notes to the Condensed Consolidated Financial Statements [1 General Information](index=7&type=section&id=1%20General%20Information) The Company, an investment holding company incorporated in the Cayman Islands, primarily provides diagnostic testing services in China through its subsidiaries and was listed on the Main Board of the Hong Kong Stock Exchange on May 18, 2022 - The Company was incorporated as an exempted company with limited liability in the Cayman Islands on July 20, 2018[13](index=13&type=chunk) - The Company is an investment holding company, and its subsidiaries are principally engaged in providing diagnostic testing services in China[13](index=13&type=chunk) - The Company's shares were listed on the Main Board of The Stock Exchange of Hong Kong Limited on May 18, 2022[14](index=14&type=chunk) [2 Basis of Preparation and Accounting Policies](index=7&type=section&id=2%20Basis%20of%20Preparation%20and%20Accounting%20Policies) The Group's condensed consolidated interim financial statements are prepared in accordance with the Listing Rules and HKAS 34, with accounting policies consistent with the prior fiscal year and no significant impact from adopted revised standards - The condensed consolidated interim financial statements have been prepared in accordance with the Listing Rules and Hong Kong Accounting Standard 34[17](index=17&type=chunk) - The accounting policies applied in preparing this financial information are consistent with those applied in the Group's consolidated financial statements for the year ended December 31, 2024[17](index=17&type=chunk) [(a) Revised Standards and Interpretations Adopted by the Group](index=7&type=section&id=(a)%20Revised%20Standards%20and%20Interpretations%20Adopted%20by%20the%20Group) The Group adopted HKAS 21 (Amendment) "Lack of Exchangeability" effective January 1, 2025, with no significant impact on its results or financial position - The adoption of HKAS 21 (Amendment) "Lack of Exchangeability" became effective on January 1, 2025[18](index=18&type=chunk) - The adoption of these amendments had no significant impact on the Group's results and financial position[18](index=18&type=chunk) [(b) New Standards, Amendments to Standards and Interpretations Issued But Not Yet Effective](index=8&type=section&id=(b)%20New%20Standards,%20Amendments%20to%20Standards%20and%20Interpretations%20Issued%20But%20Not%20Yet%20Effective) Several new HKFRSs and amendments have been issued but are not yet effective, with various effective dates, and the Company expects no material impact on its consolidated financial statements from their application New Standards and Amendments (Effective Date) | Standard | Amendment | Effective Date | | :--- | :--- | :--- | | HKFRS 9 and 7 (Amendments) | Amendments to Classification and Measurement of Financial Instruments | January 1, 2026 | | HKFRS 1, 7, 9, 10 and HKAS 7 (Amendments) | Annual Improvements to HKFRSs – Volume 11 | January 1, 2026 | | HKFRS 18 | Presentation and Disclosure in Financial Statements | January 1, 2027 | | HKFRS 19 | Non-public Sector Specific Liabilities | January 1, 2027 | | HK(IFRIC)-Int 5 (Amendment) | Presentation of Financial Statements – Classification by a Borrower of a Term Loan Containing a Repayment on Demand Clause | January 1, 2027 | | HKFRS 10 and HKAS 28 (Amendments) | Sale or Contribution of Assets between an Investor and its Associate or Joint Venture | To be determined | - The Company expects that the application of all other new HKFRSs and amendments will not have a material impact on the consolidated financial statements in the foreseeable future[20](index=20&type=chunk) [3 Critical Accounting Estimates and Judgements](index=8&type=section&id=3%20Critical%20Accounting%20Estimates%20and%20Judgements) The significant judgments, estimates, and assumptions made by management in preparing the interim financial information are consistent with those applied in the consolidated financial statements for the year ended December 31, 2024 - The critical judgments made by management in applying the Group's accounting policies and the key sources of estimation uncertainty are the same as those applied in the Group's consolidated financial statements for the year ended December 31, 2024[21](index=21&type=chunk) [4 Segment and Revenue Information](index=8&type=section&id=4%20Segment%20and%20Revenue%20Information) The Group's operating segments are reported consistently with internal reports provided to the chief operating decision-maker, with all revenue derived from diagnostic services in China and no single external customer accounting for more than 10% of total revenue - Operating segments are reported in a manner consistent with the internal reports provided to the chief operating decision-maker (the executive Directors)[22](index=22&type=chunk) - All of the Group's revenue for the six months ended June 30, 2025, was derived from China[22](index=22&type=chunk) Revenue by Type (RMB thousand) | Revenue Type | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Diagnostic Services | 313,217 | 379,943 | [(a) Segment Information](index=8&type=section&id=(a)%20Segment%20Information) The Group's operating segments are reported consistently with internal reports provided to the executive Directors, who are responsible for resource allocation and performance assessment - Operating segments are reported in a manner consistent with the internal reports provided to the chief operating decision-maker (the executive Directors)[22](index=22&type=chunk) [(c) Major Customer Information](index=9&type=section&id=(c)%20Major%20Customer%20Information) For the six months ended June 30, 2025, no single external customer accounted for 10% or more of the Group's total revenue, consistent with the prior year - For the six months ended June 30, 2025, all revenue from a single external customer was less than 10% of the Group's total revenue[25](index=25&type=chunk) [(d) Unfulfilled Performance Obligations](index=9&type=section&id=(d)%20Unfulfilled%20Performance%20Obligations) Unfulfilled performance obligations for diagnostic testing services are not significant due to short service provision times, and the Group has elected not to disclose remaining performance obligations for these contract types - The provision of diagnostic testing services is short, typically completed within hours or days[26](index=26&type=chunk) - Unfulfilled performance obligations are not significant, and the Group has elected not to disclose remaining performance obligations for these types of contracts[26](index=26&type=chunk) [5 Other Income - Net](index=9&type=section&id=5%20Other%20Income%20-%20Net) The Group's other income - net significantly increased from **RMB 6.6 million** in 2024 to **RMB 31.8 million** in 2025, primarily due to the reversal of a **RMB 31.5 million** provision for a legal dispute with an external supplier Other Income - Net (RMB thousand) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Gain on redemption of financial assets at fair value through profit or loss | – | 2,369 | | Gain on disposal of property and equipment | 370 | 3,282 | | Exchange (loss)/gain – net | (451) | 863 | | Others | 31,903 | 76 | | **Total** | **31,822** | **6,590** | - The increase in other income - net was mainly due to the Group's reversal of a **RMB 31.5 million** provision for a legal dispute into other income[27](index=27&type=chunk) [6 Finance Costs - Net](index=10&type=section&id=6%20Finance%20Costs%20-%20Net) The Group's finance costs - net decreased from **RMB 24.3 million** in 2024 to **RMB 15.1 million** in 2025, primarily due to a significant reduction in interest on interest-bearing borrowings, reflecting optimized debt structure and enhanced capital management Finance Costs - Net (RMB thousand) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Bank interest income | 4,445 | 3,628 | | Interest on interest-bearing borrowings | (19,319) | (25,831) | | Interest on lease liabilities | (272) | (820) | | Other finance costs | – | (1,235) | | **Finance Costs - Net** | **(15,146)** | **(24,258)** | - The decrease in finance costs - net was mainly due to reduced interest on interest-bearing borrowings, reflecting the Group's optimized debt structure and strengthened capital management[74](index=74&type=chunk) [7 Income Tax Credit](index=10&type=section&id=7%20Income%20Tax%20Credit) The Group recorded an income tax credit of **RMB 0.1 million** in 2025, a significant decrease from **RMB 5.7 million** in 2024, primarily due to a narrowed loss for the period, with certain entities in China enjoying preferential tax rates as high-tech enterprises or small enterprises Income Tax Credit (RMB thousand) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Current income tax | – | (213) | | Deferred income tax | 50 | 5,933 | | **Total** | **50** | **5,720** | - The decrease in income tax credit was mainly due to a reduced loss for the period[76](index=76&type=chunk) - Certain entities in Mainland China are recognized as high-tech enterprises, enjoying a preferential corporate income tax rate of **15%**[31](index=31&type=chunk) - Certain entities in Mainland China qualify as small enterprises, enjoying a preferential corporate income tax rate of **20%** on taxable profits not exceeding **RMB 3 million**[31](index=31&type=chunk) [8 Loss Per Share](index=11&type=section&id=8%20Loss%20Per%20Share) For the six months ended June 30, 2025, both basic and diluted loss per share attributable to owners of the Company were **RMB (0.09)**, significantly narrowed from **RMB (0.21)** in 2024, with diluted loss per share being the same as basic loss per share due to no potential dilutive shares Loss Per Share (RMB) | Metric | 2025 (RMB) | 2024 (RMB) | | :--- | :--- | :--- | | Basic Loss Per Share Attributable to Owners of the Company | (0.09) | (0.21) | | Diluted Loss Per Share Attributable to Owners of the Company | (0.09) | (0.21) | - Basic loss per share is calculated by dividing the loss attributable to owners of the Company by the weighted average number of ordinary shares in issue (less shares held under the restricted share unit scheme)[32](index=32&type=chunk) - For the six months ended June 30, 2025 and 2024, the Company had no potential dilutive shares in issue, thus diluted loss per share was the same as basic loss per share[34](index=34&type=chunk) [(a) Basic Loss Per Share](index=11&type=section&id=(a)%20Basic%20Loss%20Per%20Share) Basic loss per share is calculated based on the loss attributable to owners of the Company divided by the weighted average number of ordinary shares in issue, excluding shares held under the 2022 Restricted Share Unit Scheme Basic Loss Per Share Calculation (RMB thousand) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Loss Attributable to Owners of the Company | (55,340) | (126,129) | | Weighted average number of ordinary shares in issue less shares held under 2022 Restricted Share Unit Scheme | 585,344,654 | 600,602,161 | | Basic Loss Per Share Attributable to Owners of the Company (RMB) | (0.09) | (0.21) | [(b) Diluted Loss Per Share](index=11&type=section&id=(b)%20Diluted%20Loss%20Per%20Share) Diluted loss per share is the same as basic loss per share for the six months ended June 30, 2025 and 2024, as the Company had no potential dilutive shares in issue - The Company had no potential dilutive shares in issue for the six months ended June 30, 2025 and 2024[34](index=34&type=chunk) - Diluted loss per share was the same as basic loss per share for the six months ended June 30, 2025 and 2024[34](index=34&type=chunk) [9 Trade Receivables](index=12&type=section&id=9%20Trade%20Receivables) As of June 30, 2025, the Group's net trade receivables decreased to **RMB 597.1 million** from **RMB 628.5 million** on December 31, 2024, primarily due to partial collections and impairment provisions, with strict controls and measures in place for overdue debts Trade Receivables (RMB thousand) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Trade receivables (third parties) | 1,460,956 | 1,490,350 | | Trade receivables (related parties) | 594 | 403 | | Less: Impairment provision for trade receivables | (873,124) | (866,283) | | Bills receivable | 8,686 | 3,986 | | **Total** | **597,112** | **628,456** | - The decrease in trade receivables was mainly due to the collection of some trade receivables and the provision for trade receivables[80](index=80&type=chunk) - As of June 30, 2025, trade receivables with a carrying amount of **RMB 200.42 million** were pledged to secure the Group's bank borrowings[35](index=35&type=chunk) - As of the date of this announcement, **RMB 86.3 million** of trade receivables were subsequently recovered, representing **5.9%** of the trade receivables balance as of June 30, 2025[81](index=81&type=chunk) [10 Prepayments and Other Receivables](index=13&type=section&id=10%20Prepayments%20and%20Other%20Receivables) As of June 30, 2025, the Group's total prepayments and other receivables amounted to **RMB 114.9 million**, consistent with December 31, 2024, with **RMB 88.6 million** in non-current bills receivable fully redeemed subsequently Prepayments and Other Receivables (RMB thousand) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Included in current assets | 25,240 | 24,279 | | Included in non-current assets | 89,659 | 90,613 | | **Total** | **114,899** | **114,892** | - Bills receivable of **RMB 88.581 million** included in non-current assets were fully redeemed after the period end[36](index=36&type=chunk) [11 Trade and Other Payables](index=14&type=section&id=11%20Trade%20and%20Other%20Payables) As of June 30, 2025, the Group's trade and other payables decreased to **RMB 906.5 million** from **RMB 970.2 million** on December 31, 2024, mainly due to the reversal of a dispute provision for professional services and the payment of certain expenses and overdue amounts Trade and Other Payables (RMB thousand) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Trade payables (third parties) | 139,290 | 147,785 | | Trade payables (related parties) | 644,133 | 631,579 | | Other payables | 74,699 | 130,943 | | Accrued staff costs | 41,523 | 48,551 | | Other taxes payable | 6,892 | 11,300 | | **Total** | **906,537** | **970,158** | - The decrease in trade and other payables was mainly due to the reversal of a dispute provision (RMB 31.5 million) arising from professional services not meeting expectations and the payment of certain expenses and overdue amounts[83](index=83&type=chunk)[37](index=37&type=chunk) [12 Dividends](index=15&type=section&id=12%20Dividends) The Board of Directors declared no interim dividend for the six months ended June 30, 2025, consistent with the prior year - The Board of Directors declared no interim dividend for the six months ended June 30, 2025 (June 30, 2024: nil)[38](index=38&type=chunk) [13 Contingent Liabilities](index=15&type=section&id=13%20Contingent%20Liabilities) As of June 30, 2025, the Group had no significant contingent liabilities, consistent with December 31, 2024 - As of June 30, 2025, the Group had no significant contingent liabilities[39](index=39&type=chunk) [14 Events After the Reporting Period](index=15&type=section&id=14%20Events%20After%20the%20Reporting%20Period) No significant events affecting the Group have occurred after June 30, 2025, other than those disclosed in this announcement - No significant events affecting the Group have occurred after June 30, 2025, other than those disclosed in this announcement[40](index=40&type=chunk) Industry Overview [1.1 Medical Alliance Construction Shifts to High-Quality Development, Optimizing Medical Service System to Further Release Market Demand](index=16&type=section&id=1.1%20Medical%20Alliance%20Construction%20Shifts%20to%20High-Quality%20Development,%20Optimizing%20Medical%20Service%20System%20to%20Further%20Release%20Market%20Demand) As 2025 marks the end of the "14th Five-Year Plan," China's healthcare sector has achieved high-quality development with comprehensive coverage of medical alliances, driving a shift towards high-quality operations, resource decentralization, and mutual recognition of test results, creating a **hundred-billion-level incremental market** in emerging fields like molecular diagnostics and gene sequencing - During the "14th Five-Year Plan" period, 114 new national regional medical centers were established, bringing the total to 125[42](index=42&type=chunk) - As of the end of 2024, 2,188 counties (cities, districts) nationwide have promoted the construction of closely integrated county medical communities, achieving full coverage at the provincial level[42](index=42&type=chunk) - The national government will further promote the sharing of high-quality medical and health resources and popularize the "distributed testing, centralized diagnosis" medical service model[42](index=42&type=chunk) - Medical alliance construction is expected to create a **hundred-billion-level incremental market**, especially in emerging fields such as molecular diagnostics and gene sequencing[43](index=43&type=chunk) [1.2 Broad Prospects for Precision Medicine Market, Policy and Technology Synergy Drive Industry Upgrade](index=17&type=section&id=1.2%20Broad%20Prospects%20for%20Precision%20Medicine%20Market,%20Policy%20and%20Technology%20Synergy%20Drive%20Industry%20Upgrade) Precision medicine is in a golden development period, driven by favorable policies like the "14th Five-Year Plan" for bioeconomy development and a **RMB 60 billion** investment plan by 2030, alongside rapid advancements in gene sequencing and immunotherapy, with high-quality development of LDTs being crucial for clinical translation and scaled practice to meet demand for precise diagnostics in conditions like malignant tumors and severe infectious diseases - The National Development and Reform Commission's "14th Five-Year Plan for Bioeconomy Development" explicitly lists precision medicine as a key development direction for the healthcare industry[45](index=45&type=chunk) - The Ministry of Science and Technology plans to invest **RMB 60 billion** by 2030 to build a precision medicine system covering the entire disease cycle[45](index=45&type=chunk) - The high-quality development of LDT (Laboratory Developed Tests) will promote the clinical translation and scaled practice of precision medicine[46](index=46&type=chunk) - Technologies such as NGS and mass spectrometry have become indispensable for the diagnosis and treatment guidance of malignant tumors and severe infectious diseases[46](index=46&type=chunk) [1.3 AI Empowers Hierarchical Diagnosis and Treatment, Industry Welcomes New Development Opportunities](index=18&type=section&id=1.3%20AI%20Empowers%20Hierarchical%20Diagnosis%20and%20Treatment,%20Industry%20Welcomes%20New%20Development%20Opportunities) In 2025, national and local policies strongly support "AI+Healthcare" initiatives, promoting AI applications in medical service management, primary public health, and health industry development, with AI large models effectively addressing resource imbalances and talent shortages in grassroots healthcare, enhancing diagnostic efficiency and accuracy, and creating historical opportunities for the third-party medical testing industry to implement hierarchical diagnosis and treatment - National and local policies strongly support "AI+Healthcare" construction, issuing the "Reference Guidelines for AI Application Scenarios in the Health Industry"[47](index=47&type=chunk) - AI large model technology can help grassroots doctors quickly and accurately analyze conditions, improving diagnostic efficiency and accuracy, and compensating for the diagnostic capabilities of grassroots doctors[48](index=48&type=chunk) - Smart healthcare has become an important way to improve the quality and efficiency of medical services at all levels, effectively promoting the implementation of hierarchical diagnosis and treatment[48](index=48&type=chunk) - The scenario-based implementation of medical AI technology brings historical opportunities for the third-party medical testing industry[48](index=48&type=chunk) Business Review [Business Review](index=19&type=section&id=Business%20Review) Despite macroeconomic challenges, the Group adhered to its "deep service, lean operation" strategy, implementing a "one horizontal, one vertical" approach and leveraging AI for medical alliance solutions, resulting in a **17.6% decrease in diagnostic testing service revenue to RMB 313.2 million**, but a significant **56.1% narrowing of net loss to RMB 55.4 million** and an improved **gross profit margin of 34.0%**, with diagnostic testing services for medical alliances remaining the largest business segment at **57.6% of total revenue** - The Group firmly adheres to the operating principle of "deep service, lean operation," continuously strengthening clinical empowerment value[49](index=49&type=chunk) - Implementation of the "one horizontal, one vertical" strategy: horizontally exporting a lean operating system to promote multi-mode cooperation in medical alliances; vertically focusing on medical-lab joint innovation in specialized areas[49](index=49&type=chunk) - Empowering medical alliance overall solutions with AI, promoting the practical application of AI in medical scenarios[49](index=49&type=chunk) Key Business Metrics (RMB million) | Metric | 2025 (RMB million) | 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Diagnostic testing services revenue | 313.2 | 379.9 | (17.6)% | | Net Loss | (55.4) | (126.1) | (56.1)% | | Gross Profit Margin | 34.0% | 33.7% | +0.3% | | Diagnostic testing services revenue for medical alliances | 180.3 | 182.3 | (1.1)% | | Proportion of medical alliance business to total revenue | 57.6% | 48.0% | +9.6% | [2.1 "One Horizontal, One Vertical" Strategy Steadily Implemented, Hospital-Enterprise Cooperation Yields Significant Results](index=20&type=section&id=2.1%20%22One%20Horizontal,%20One%20Vertical%22%20Strategy%20Steadily%20Implemented,%20Hospital-Enterprise%20Cooperation%20Yields%20Significant%20Results) The Group's "one horizontal, one vertical" strategy is steadily implemented, with the horizontal approach exporting a lean operating system to nearly **450 medical alliance clients**, maintaining this business as the largest segment, while the vertical approach, through the "Medical-Lab Joint Innovation Platform," collaborates with dozens of top medical institutions nationwide to develop innovative diagnostic products and publish expert consensuses, driving long-term growth - The Group is committed to developing an innovative service model for medical alliance co-construction based on specialization, standardization, digitalization, and collaboration[51](index=51&type=chunk) - It has provided multi-scenario solutions, including AI+medical alliance digital solutions and overall medical laboratory cooperation, to nearly **450 medical alliance clients**[51](index=51&type=chunk) - Medical alliance co-construction business has consistently remained the Group's largest business segment since 2023, accounting for **57.6% of total revenue** during the reporting period[51](index=51&type=chunk) - The Group pioneered the "Medical-Lab Joint Innovation Platform," collaborating with dozens of top medical institutions nationwide to successfully develop dozens of innovative diagnostic products for infectious syndromes and personalized medication gene testing[52](index=52&type=chunk) [Outputting Lean Operating System, Promoting Multi-mode Cooperation in Medical Alliances](index=20&type=section&id=Outputting%20Lean%20Operating%20System,%20Promoting%20Multi-mode%20Cooperation%20in%20Medical%20Alliances) Yunkang Group, a pioneer in medical alliance construction, exports its lean operating system to nearly **450 medical alliance clients**, offering multi-mode, multi-scenario solutions including AI+digital solutions, effectively enhancing medical institutions' service capabilities and maintaining stable development in the medical alliance diagnostic testing service segment, which accounts for **57.6% of total revenue** - The Group has provided multi-scenario solutions for different clinical needs to nearly **450 medical alliance clients**, including AI+medical alliance digital solutions[51](index=51&type=chunk) - The diagnostic testing services for medical alliances segment recorded revenue of **RMB 180.3 million**, largely flat compared to the same period last year[51](index=51&type=chunk) - The medical alliance co-construction business accounted for **57.6% of total revenue**, an increase of approximately **9.6%** compared to the same period last year[51](index=51&type=chunk) [Medical-Lab Joint Innovation Platform Builds Strong Engine for Scientific Innovation, Result Transformation Drives Long-term Development](index=20&type=section&id=Medical-Lab%20Joint%20Innovation%20Platform%20Builds%20Strong%20Engine%20for%20Scientific%20Innovation,%20Result%20Transformation%20Drives%20Long-term%20Development) Through its "Medical-Lab Joint Innovation Platform," the Group collaborates with top medical institutions like Guangdong Provincial People's Hospital and Guangzhou Medical University First Affiliated Hospital to develop new panel products for respiratory, central nervous system, and urinary tNGS, as well as pharmacogenomic testing for mental illnesses, and has published the "Expert Consensus on Clinical Standardized Application of tNGS," achieving efficient R&D outcome transformation - Deepened cooperation with Guangdong Provincial People's Hospital, focusing on the research and development and clinical application of specialized customized pathogen targeted next-generation sequencing (tNGS) projects[53](index=53&type=chunk) - Launched new panel products for respiratory infections, central nervous system infections, and invasive fungal infections, and formed the "Expert Consensus on Clinical Standardized Application of tNGS"[53](index=53&type=chunk) - Collaborated with Guangzhou Medical University First Affiliated Hospital to develop urinary tNGS products, promoting precise diagnosis and treatment of urinary tract infections[54](index=54&type=chunk) - Jointly established a "School-Hospital-Enterprise Joint Innovation Platform" with Jinan University First Affiliated Hospital to incubate the "Innovative Project for Pharmacogenomic Testing of Mental Illnesses"[54](index=54&type=chunk) [2.2 AI Empowers Multi-mode Solutions for Medical Alliances, Enhancing Quality and Efficiency to Deeply Serve Customers](index=21&type=section&id=2.2%20AI%20Empowers%20Multi-mode%20Solutions%20for%20Medical%20Alliances,%20Enhancing%20Quality%20and%20Efficiency%20to%20Deeply%20Serve%20Customers) Yunkang Group actively builds an "AI+Healthcare" smart medical platform, fully integrating the DeepSeek large model to apply AI technology across its medical laboratory's multi-technology platforms, significantly improving data processing, deep image reading, disease analysis, and report interpretation efficiency, while also extending to clinical multi-scenario innovative product services, customer service, and sample management for comprehensive optimization of medical testing service processes - Yunkang focuses on new medical technologies, cloud computing, big data, IoT, 5G, and AI to build an "AI+Healthcare" smart medical platform[55](index=55&type=chunk) - The Group officially integrated DeepSeek, applying AI technology comprehensively across its medical laboratory's multi-technology platforms[56](index=56&type=chunk) - AI technology significantly enhances capabilities in data processing, deep image reading, disease analysis, and report interpretation, substantially improving laboratory testing efficiency and shortening report turnaround times[56](index=56&type=chunk) - AI technology is widely applied in key support systems such as clinical multi-scenario innovative product services, customer service, and sample management, enabling intelligent online customer service and efficient review of results and reports[56](index=56&type=chunk) [AI Technology Deeply Empowers Full Clinical Diagnosis and Treatment Process](index=22&type=section&id=AI%20Technology%20Deeply%20Empowers%20Full%20Clinical%20Diagnosis%20and%20Treatment%20Process) The Group, in collaboration with Runda Medical, launched the "Zhiyun" medical large model, based on general large model technologies like DeepSeek, Pangu, and Tongyi Qianwen, covering pre-diagnosis, in-diagnosis, and post-diagnosis scenarios to provide efficient and convenient support for clinical medical services; a strategic cooperation agreement has been signed to deepen the "AI+IVD+Medical Services" industry ecosystem, with "Zhiyun" to be piloted in Yunkang's partner medical institutions - The "Zhiyun" medical large model, developed in collaboration with Runda Medical, was officially launched, based on general large model technologies such as DeepSeek, Pangu, and Tongyi Qianwen[58](index=58&type=chunk) - "Zhiyun" covers pre-diagnosis, in-diagnosis, and post-diagnosis scenarios, providing more efficient and convenient support and experience for clinical medical services[58](index=58&type=chunk) - The Group signed a strategic cooperation agreement with Runda Medical to strengthen deep cooperation in the "AI+IVD+Medical Services" industry ecosystem[58](index=58&type=chunk) - The "Zhiyun" medical large model will be piloted in Yunkang's partner medical institutions and gradually promoted nationwide[58](index=58&type=chunk) Management Discussion and Analysis [Revenue](index=23&type=section&id=Revenue) During the reporting period, the Group's revenue was **RMB 313.2 million**, a **17.6% year-on-year decrease**, primarily due to centralized procurement, medical insurance cost control, and intensified industry competition, with diagnostic outsourcing services revenue decreasing by **34.0% to RMB 118.5 million** and diagnostic testing services for non-medical institutions decreasing by **20.3% to RMB 14.4 million**, while diagnostic testing services for medical alliances remained largely stable, accounting for **57.6% of total revenue** - During the reporting period, the Group recorded revenue of **RMB 313.2 million**, a **17.6% decrease** compared to the same period in 2024[60](index=60&type=chunk) - The Group's overall revenue decline was primarily influenced by factors such as centralized procurement, medical insurance cost control, and intensified industry competition[60](index=60&type=chunk) Revenue by Source (RMB thousand) | Revenue Source | 2025 (RMB thousand) | 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Diagnostic testing services for medical alliances | 180,333 | 182,272 | (1.1)% | | Diagnostic outsourcing services | 118,491 | 179,614 | (34.0)% | | Diagnostic testing services for non-medical institutions | 14,393 | 18,057 | (20.3)% | | **Total Revenue** | **313,217** | **379,943** | **(17.6)%** | [Diagnostic Testing Services for Medical Alliances](index=23&type=section&id=Diagnostic%20Testing%20Services%20for%20Medical%20Alliances) The Group's revenue from diagnostic testing services for medical alliances was **RMB 180.3 million**, largely stable compared to the same period in 2024, and continues to be the Group's largest business segment, accounting for **57.6% of total revenue**, an increase of approximately **9.6%** year-on-year, demonstrating a clear competitive advantage - Revenue from diagnostic testing services for medical alliances was **RMB 180.3 million**, largely flat compared to the same period in 2024[63](index=63&type=chunk) - This business has consistently remained the Group's largest business segment since 2023, with its revenue accounting for **57.6% of total revenue** during the reporting period, an increase of approximately **9.6%** compared to the same period last year[63](index=63&type=chunk) [Diagnostic Outsourcing Services](index=24&type=section&id=Diagnostic%20Outsourcing%20Services) Revenue from diagnostic outsourcing services was **RMB 118.5 million**, a **34.0% decrease** from the same period in 2024, primarily due to the impact of industry policies, intense market competition, and the Group's proactive optimization of its customer structure - Revenue from diagnostic outsourcing services was **RMB 118.5 million**, a **34.0% decrease** compared to the same period in 2024[64](index=64&type=chunk) - The decrease in revenue was mainly due to the impact of industry policies and intense market competition, with the growth in demand for routine testing services falling short of expectations, and the Group's proactive optimization of its customer structure[64](index=64&type=chunk) [Diagnostic Testing Services for Non-medical Institutions](index=24&type=section&id=Diagnostic%20Testing%20Services%20for%20Non-medical%20Institutions) Revenue from diagnostic testing services for non-medical institutions was **RMB 14.4 million**, a **20.3% decrease** from the same period in 2024, primarily due to external market conditions and intensified industry competition - Revenue from diagnostic testing services for non-medical institutions was **RMB 14.4 million**, a **20.3% decrease** compared to the same period in 2024[65](index=65&type=chunk) - The decrease in revenue was mainly due to external market conditions and intensified industry competition[65](index=65&type=chunk) [Cost of Revenue](index=24&type=section&id=Cost%20of%20Revenue) The Group's cost of revenue decreased by **17.8% to RMB 206.8 million** in 2025 from **RMB 251.7 million** in 2024, primarily due to a corresponding reduction in line with the overall revenue decline - Cost of revenue decreased by **17.8% to RMB 206.8 million** in 2025 from **RMB 251.7 million** in 2024[66](index=66&type=chunk) - The decrease was mainly due to the overall decline in revenue, which led to a corresponding reduction in cost of revenue[66](index=66&type=chunk) [Gross Profit and Gross Profit Margin](index=24&type=section&id=Gross%20Profit%20and%20Gross%20Profit%20Margin) The Group's gross profit decreased by **17.0% to RMB 106.4 million** in 2025 from **RMB 128.2 million** in 2024, primarily due to the overall revenue decline; however, the gross profit margin slightly increased from **33.7% to 34.0%** through continuous optimization of operating costs and improved resource utilization efficiency - Gross profit decreased by **17.0% to RMB 106.4 million** in 2025 from **RMB 128.2 million** in 2024[67](index=67&type=chunk) - The overall gross profit margin increased from **33.7%** in the same period of 2024 to **34.0%** in the same period of 2025[67](index=67&type=chunk) - The improvement in gross profit margin was mainly due to the Group's continuous optimization of operating costs, further enhancing resource utilization efficiency, and reducing costs while increasing efficiency[67](index=67&type=chunk) [Other Income](index=24&type=section&id=Other%20Income) The Group's other income decreased from **RMB 1.0 million** in 2024 to **RMB 0.3 million** in 2025, primarily due to a reduction in government grants - Other income decreased from **RMB 1.0 million** in 2024 to **RMB 0.3 million** in 2025[68](index=68&type=chunk) - This decrease was mainly due to a reduction in government grants[68](index=68&type=chunk) [Other Income - Net](index=25&type=section&id=Other%20Income%20-%20Net) The Group's other income - net increased from **RMB 6.6 million** in 2024 to **RMB 31.8 million** in 2025, primarily due to the reversal of a **RMB 31.5 million** provision for a legal dispute with an external supplier into other income following the withdrawal of the lawsuit - Other income - net increased from **RMB 6.6 million** in 2024 to **RMB 31.8 million** in 2025[69](index=69&type=chunk) - This increase was mainly due to the Group's reversal of a **RMB 31.5 million** provision for a legal dispute into other income[69](index=69&type=chunk) [Selling Expenses](index=25&type=section&id=Selling%20Expenses) The Group's selling expenses decreased by **41.0% to RMB 53.1 million** in 2025 from **RMB 89.9 million** in 2024, primarily due to the Group's continuous improvement in operational and management capabilities, achieved through strengthened cost control and precise allocation of expenses - Selling expenses decreased by **41.0% to RMB 53.1 million** in 2025 from **RMB 89.9 million** in 2024[70](index=70&type=chunk) - The decrease was mainly due to the Group's continuous improvement in operational and management capabilities, achieved through strengthened cost control and precise allocation of expenses[70](index=70&type=chunk) [Administrative Expenses](index=25&type=section&id=Administrative%20Expenses) The Group's administrative expenses decreased by **21.5% to RMB 78.3 million** in 2025 from **RMB 99.7 million** in 2024, primarily due to a **RMB 9.7 million** reduction in restricted share award expenses and optimized management processes, while R&D expenses slightly decreased to **RMB 21.1 million** but increased as a percentage of total revenue from **6.5% to 6.7%**, indicating continued investment in innovation - Administrative expenses decreased by **21.5% to RMB 78.3 million** in 2025 from **RMB 99.7 million** in 2024[71](index=71&type=chunk) - The decrease was mainly due to a **RMB 9.7 million** reduction in restricted share award expenses and the Group's continuous optimization of management processes[71](index=71&type=chunk) - Research and development expenses slightly decreased from **RMB 24.7 million** in 2024 to **RMB 21.1 million** in 2025[71](index=71&type=chunk) - Research and development expenses as a percentage of total revenue increased from **6.5%** in the same period of 2024 to **6.7%** in the same period of 2025[71](index=71&type=chunk) [Impairment Loss on Financial Assets](index=25&type=section&id=Impairment%20Loss%20on%20Financial%20Assets) The Group's impairment loss on financial assets, primarily trade receivables provisions, was approximately **RMB 8.4 million** for the six months ended June 30, 2025, a **RMB 44.0 million** decrease from **RMB 52.4 million** in the prior year, with the Group using a "simplified approach" for expected credit loss calculation and planning to strengthen trade receivables management through legal actions and collection efforts - Impairment loss on financial assets was approximately **RMB 8.4 million**, a **RMB 44.0 million** decrease from **RMB 52.4 million** in the same period of 2024[72](index=72&type=chunk) - The Group applies the "simplified approach" permitted by HKFRS for calculating expected credit losses[72](index=72&type=chunk) - Group management will take necessary measures to strengthen the management of trade receivables, including enhancing credit control, intensifying collection efforts, and taking legal action[73](index=73&type=chunk) [Finance Costs - Net](index=26&type=section&id=Finance%20Costs%20-%20Net) The Group's finance costs - net decreased from **RMB 24.3 million** in 2024 to **RMB 15.1 million** in 2025, primarily due to the Group's continuous optimization of its debt structure and strengthened capital management, leading to reduced interest expenses on interest-bearing borrowings - Finance costs - net decreased from **RMB 24.3 million** in 2024 to **RMB 15.1 million** in 2025[74](index=74&type=chunk) - The decrease was mainly due to the Group's continuous optimization of its debt structure and strengthened capital management, leading to reduced interest expenses on interest-bearing borrowings[74](index=74&type=chunk) [Loss Before Income Tax](index=26&type=section&id=Loss%20Before%20Income%20Tax) The Group recorded a **loss before income tax of RMB 55.4 million** in 2025, a significant decrease from **RMB 131.8 million** in 2024, primarily attributable to enhanced operational management, cost control, reduced selling and administrative expenses, substantially lower finance costs, decreased impairment provisions for assets, and the reversal of legal dispute provisions - Loss before income tax decreased from **RMB 131.8 million** in 2024 to **RMB 55.4 million** in 2025[75](index=75&type=chunk) - The decrease in loss was mainly due to: enhanced operational and management capabilities, strengthened cost control, reduced selling and administrative expenses, a substantial decrease in finance costs, a reduction in impairment provisions for assets of approximately **RMB 44.0 million**, and the reversal of legal dispute provisions into other income of approximately **RMB 31.5 million**[75](index=75&type=chunk) [Income Tax Credit](index=26&type=section&id=Income%20Tax%20Credit) The Group recorded an income tax credit of **RMB 0.1 million** in 2025, a significant decrease from **RMB 5.7 million** in 2024, primarily due to a reduced loss for the period - Income tax credit decreased from **RMB 5.7 million** in 2024 to **RMB 0.1 million** in 2025[76](index=76&type=chunk) - The decrease was mainly due to a reduced loss for the period[76](index=76&type=chunk) [Property and Equipment](index=27&type=section&id=Property%20and%20Equipment) The Group's property and equipment decreased from **RMB 314.3 million** on December 31, 2024, to **RMB 311.2 million** on June 30, 2025, primarily due to depreciation and amortization - Property and equipment decreased from **RMB 314.3 million** on December 31, 2024, to **RMB 311.2 million** on June 30, 2025[77](index=77&type=chunk) - The decrease was mainly due to depreciation and amortization of property and equipment[77](index=77&type=chunk) [Financial Assets Measured at Fair Value](index=27&type=section&id=Financial%20Assets%20Measured%20at%20Fair%20Value) As of June 30, 2025, the balance of financial assets at fair value through profit or loss increased by **RMB 92.2 million to RMB 567.6 million**, primarily due to increased private equity investments and fair value fluctuations, while financial assets at fair value through other comprehensive income also slightly increased - The balance of financial assets at fair value through profit or loss was **RMB 567.6 million**, an increase of **RMB 92.2 million** compared to December 31, 2024[78](index=78&type=chunk) - The increase was due to increased investments in private equity funds and the impact of fair value fluctuations of financial assets at fair value through profit or loss during the reporting period[78](index=78&type=chunk) - The balance of financial assets at fair value through other comprehensive income was **RMB 64.1 million**, an increase of **RMB 5.0 million** compared to December 31, 2024[78](index=78&type=chunk) [Inventories](index=27&type=section&id=Inventories) The Group's inventories, primarily reagents and pharmaceuticals, increased from **RMB 16.1 million** on December 31, 2024, to **RMB 16.7 million** on June 30, 2025, a non-material change - Inventories increased from **RMB 16.1 million** on December 31, 2024, to **RMB 16.7 million** on June 30, 2025, a non-material change[79](index=79&type=chunk) [Trade Receivables](index=28&type=section&id=Trade%20Receivables) The Group's trade receivables decreased from **RMB 628.5 million** on December 31, 2024, to **RMB 597.1 million** on June 30, 2025, primarily due to partial collections and impairment provisions, with strict controls maintained over outstanding receivables to minimize credit risk Trade Receivables (RMB thousand) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Trade receivables (third parties) | 1,460,956 | 1,490,350 | | Trade receivables (related parties) | 594 | 403 | | Less: Impairment provision for trade receivables | (873,124) | (866,283) | | Bills receivable | 8,686 | 3,986 | | **Total** | **597,112** | **628,456** | - The decrease in trade receivables was mainly due to the collection of some trade receivables and the provision for trade receivables[80](index=80&type=chunk) - The Group seeks to maintain strict control over outstanding receivables and has a credit control department to minimize credit risk[80](index=80&type=chunk) - As of the date of this announcement, **RMB 86.3 million** of trade receivables were subsequently recovered, representing **5.9%** of the trade receivables balance as of June 30, 2025[81](index=81&type=chunk) [Prepayments and Other Receivables](index=29&type=section&id=Prepayments%20and%20Other%20Receivables) The Group's prepayments and other receivables amounted to **RMB 114.9 million** as of June 30, 2025, which was largely consistent with the amount as of December 31, 2024 - Prepayments and other receivables amounted to **RMB 114.9 million** as of June 30, 2025, which was largely consistent with the amount as of December 31, 2024[82](index=82&type=chunk) [Trade and Other Payables](index=29&type=section&id=Trade%20and%20Other%20Payables) The Group's trade and other payables decreased from **RMB 970.2 million** on December 31, 2024, to **RMB 906.5 million** on June 30, 2025, primarily due to the reversal of a dispute provision for professional services not meeting expectations and the payment of certain expenses and overdue amounts - Trade and other payables decreased from **RMB 970.2 million** on December 31, 2024, to **RMB 906.5 million** on June 30, 2025[83](index=83&type=chunk) - The decrease was mainly due to the reversal of a dispute provision arising from professional services not meeting expectations and the payment of certain expenses and overdue amounts[83](index=83&type=chunk) [Capital Management](index=29&type=section&id=Capital%20Management) The Group's capital management objective is to safeguard its ability to continue as a going concern, provide returns to shareholders, and benefit other stakeholders, while maintaining an optimal capital structure to minimize capital costs - The Group's capital management objective is to safeguard its ability to continue as a going concern, so as to provide returns to its shareholders and benefits for other stakeholders[84](index=84&type=chunk) - It also aims to maintain an optimal capital structure to reduce capital costs[84](index=84&type=chunk) [Liquidity and Capital Resources](index=29&type=section&id=Liquidity%20and%20Capital%20Resources) The Group's cash and cash equivalents decreased to **RMB 1,186.1 million**, primarily due to increased investments in financial assets at fair value through profit or loss and partial repayment of borrowings; however, net current assets increased to **RMB 777.5 million** due to reduced current liabilities, improving both current and quick ratios - Cash and cash equivalents decreased from **RMB 1,321.4 million** on December 31, 2024, to **RMB 1,186.1 million** on June 30, 2025[85](index=85&type=chunk) - The decrease was mainly due to the Group's increased investments in financial assets at fair value through profit or loss and partial repayment of borrowings[85](index=85&type=chunk) [Summary of Net Current Assets](index=30&type=section&id=Summary%20of%20Net%20Current%20Assets) The Group's net current assets increased from **RMB 743.0 million** on December 31, 2024, to **RMB 777.5 million** on June 30, 2025, primarily due to a reduction in borrowings included in current liabilities and a decrease in trade and other payables Net Current Assets (RMB thousand) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Total Current Assets | 2,490,119 | 2,659,451 | | Total Current Liabilities | 1,712,571 | 1,916,435 | | **Net Current Assets** | **777,548** | **743,016** | - The increase in net current assets was mainly due to a decrease in borrowings included in current liabilities and a decrease in trade and other payables[86](index=86&type=chunk) [Key Financial Ratios](index=31&type=section&id=Key%20Financial%20Ratios) The Group's gross profit margin slightly improved to **34.0%**, with current and quick ratios both increasing to **1.45** and **1.44** respectively, while the gearing ratio remained at **0.64** Key Financial Ratios | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Gross Profit Margin | 34.0% | 33.7% | | Current Ratio | 1.45 | 1.39 | | Quick Ratio | 1.44 | 1.38 | | Gearing Ratio | 0.64 | 0.64 | [Contingent Liabilities](index=31&type=section&id=Contingent%20Liabilities) As of June 30, 2025, the Group had no contingent liabilities - As of June 30, 2025, the Group had no contingent liabilities[92](index=92&type=chunk) [Financing and Treasury Policies](index=31&type=section&id=Financing%20and%20Treasury%20Policies) The Group adopts a centralized financing and treasury policy to ensure efficient use of funds, maintain a sound liquidity position, and manage its capital structure to balance shareholder returns with capital costs - The Group adopts a centralized financing and treasury policy to ensure the effective use of the Group's funds[93](index=93&type=chunk) - The Group maintains a sound liquidity position with sufficient cash reserves and committed adequate credit facilities from major financial institutions[93](index=93&type=chunk) - The Group's primary objective of capital management is to safeguard its ability to generate returns for shareholders and benefits for other stakeholders by pricing products commensurate with the level of risk and obtaining financing at a reasonable cost[93](index=93&type=chunk) [Foreign Exchange Risk](index=32&type=section&id=Foreign%20Exchange%20Risk) The Group faces foreign exchange risk from bank deposits denominated in HKD and USD, financial assets at fair value through profit or loss, and borrowings denominated in CHF; the Group has implemented forward foreign currency swap arrangements for CHF-denominated borrowings to mitigate exchange risk and will continue to monitor foreign exchange exposure - Foreign exchange risk arises from bank deposits denominated in HKD or USD, financial assets at fair value through profit or loss, and borrowings denominated in CHF[94](index=94&type=chunk) - The Group has entered into forward foreign currency swap arrangements for CHF-denominated borrowings to mitigate exchange risk[94](index=94&type=chunk) [Cash Flow and Fair Value Interest Rate Risk](index=32&type=section&id=Cash%20Flow%20and%20Fair%20Value%20Interest%20Rate%20Risk) The Group's interest rate risk arises from borrowings, with floating-rate borrowings exposing it to cash flow interest rate risk and fixed-rate borrowings to fair value interest rate risk; the Group currently does not use interest rate swap arrangements but will consider hedging interest rate risk if necessary - The Group's interest rate risk arises from borrowings, with interest-bearing borrowings at floating rates exposing the Group to cash flow interest rate risk, and interest-bearing borrowings at fixed rates exposing the Group to fair value interest rate risk[95](index=95&type=chunk) - The Group currently does not use any interest rate swap arrangements but will consider hedging interest rate risk if necessary[95](index=95&type=chunk) [Credit Risk](index=32&type=section&id=Credit%20Risk) The Group faces credit risk related to trade and other receivables, amounts due from related parties, and bank cash deposits, with the carrying amounts of these financial assets representing the maximum credit risk exposure - The Group faces credit risk related to trade and other receivables, amounts due from related parties, and bank cash deposits[96](index=96&type=chunk) - The carrying amounts of each class of financial assets mentioned above represent the Group's maximum exposure to credit risk for the respective class of financial assets[96](index=96&type=chunk) [Liquidity Risk](index=32&type=section&id=Liquidity%20Risk) To manage liquidity risk, the Group regularly monitors its liquidity requirements and compliance with loan covenants, ensuring sufficient cash reserves and committed credit facilities from major financial institutions to meet both short-term and long-term liquidity needs - The Group's policy is to regularly monitor its liquidity requirements and compliance with loan covenants[97](index=97&type=chunk) - It ensures sufficient cash reserves and committed adequate credit facilities from major financial institutions to meet both short-term and long-term liquidity needs[97](index=97&type=chunk) [Borrowings and Gearing Ratio](index=33&type=section&id=Borrowings%20and%20Gearing%20Ratio) As of June 30, 2025, the Group's total borrowings were **RMB 1,003.6 million**, a decrease from December 31, 2024, and the gearing ratio slightly decreased from **93.3% to 92.2%**, primarily due to a reduction in total interest-bearing borrowings and lease liabilities Borrowings and Gearing Ratio (RMB thousand) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Interest-bearing borrowings | 1,003,558 | 1,053,914 | | Lease liabilities | 12,530 | 19,030 | | Total interest-bearing borrowings and lease liabilities | 1,016,088 | 1,072,944 | | Total Equity | 1,102,487 | 1,149,877 | | Total Equity plus Other Financial Liabilities | 1,102,487 | 1,149,877 | | **Gearing Ratio** | **92.2%** | **93.3%** | - The gearing ratio decreased mainly due to a **RMB 56.9 million** reduction in total interest-bearing borrowings and lease liabilities compared to December 31, 2024[98](index=98&type=chunk) [Pledge of Assets](index=33&type=section&id=Pledge%20of%20Assets) As of June 30, 2025, approximately **RMB 431.3 million** of borrowings were secured by certain equipment and land parcels, and pledged by certain time deposits, trade receivables, and equity interests in a subsidiary - Approximately **RMB 431.3 million** of borrowings were secured by certain equipment and land parcels of the Group, and pledged by certain time deposits, certain trade receivables, and equity interests in a subsidiary[99](index=99&type=chunk) [Material Investments, Acquisitions and Disposals of Subsidiaries, Associates and Joint Ventures During the Reporting Period](index=34&type=section&id=Material%20Investments,%20Acquisitions%20and%20Disposals%20of%20Subsidiaries,%20Associates%20and%20Joint%20Ventures%20During%20the%20Reporting%20Period) The Group did not undertake any material investments, acquisitions, or disposals of subsidiaries, associates, or joint ventures during the reporting period - The Group did not undertake any material investments, material acquisitions or disposals of subsidiaries, associates and joint ventures during the reporting period[100](index=100&type=chunk) [Events After the Reporting Period](index=34&type=section&id=Events%20After%20the%20Reporting%20Period) No significant events affecting the Group have occurred from June 30, 2025, up to the date of this announcement - No significant events affecting the Group have occurred from June 30, 2025, up to the date of this announcement[101](index=101&type=chunk) [Future Plans for Material Investments and Capital Assets](index=34&type=section&id=Future%20Plans%20for%20Material%20Investments%20and%20Capital%20Assets) As of the date of this announcement, the Group has no specific committed plans for material investments and capital assets - As of the date of this announcement, the Group has no specific committed plans for material investments and capital assets[102](index=102&type=chunk) [Employees and Remuneration](index=34&type=section&id=Employees%20and%20Remuneration) As of June 30, 2025, the Group had **1,146 employees** with a total remuneration cost of **RMB 124.6 million**, including **RMB 8.0 million** in restricted share award expenses; the Group offers competitive compensation, benefits, and training, and has a restricted share unit scheme to incentivize key personnel - As of June 30, 2025, the Group had **1,146 employees** (June 30, 2024: 1,459 employees)[103](index=103&type=chunk) - For the six months ended June 30, 2025, the total remuneration cost incurred by the Group was **RMB 124.6 million** (same period in 2024: **RMB 156.2 million**)[103](index=103&type=chunk) - Total employee remuneration included expenses related to restricted share awards of approximately **RMB 8.0 million** (same period in 2024: **RMB 17.7 million**)[103](index=103&type=chunk) - The Company adopted a Restricted Share Unit Scheme on November 23, 2022, to attract, retain, and incentivize key personnel and partners of the Company[103](index=103&type=chunk) Other Information [Compliance with Code Provisions in Part 2 of the Corporate Governance Code ("CG Code") Contained in Appendix C1 of the Listing Rules](index=35&type=section&id=Compliance%20with%20Code%20Provisions%20in%20Part%202%20of%20the%20Corporate%20Governance%20Code%20(%22CG%20Code%22)%20Contained%20in%20Appendix%20C1%20of%20the%20Listing%20Rules) The Company is committed to high standards of corporate governance and has adopted the CG Code, complying with all applicable code provisions during the reporting period, except for the combined roles of Chairman and Chief Executive Officer held by Mr. Zhang Yong, which the Board believes benefits the Group's operations and management - The Company has adopted the principles and code provisions of the CG Code as the basis for its corporate governance practices[105](index=105&type=chunk) - During the reporting period, the Company complied with all applicable code provisions, except for the deviation from code provision C.2.1 of the CG Code (the roles of chairman and chief executive officer should be separate)[105](index=105&type=chunk) - Mr. Zhang Yong currently serves as both the Chairman of the Board and the Chief Executive Officer of the Company, and the Directors believe that his dual role benefits the Group's business operations and management[105](index=105&type=chunk) [Compliance with the Model Code for Securities Transactions by Directors of Listed Issuers ("Model Code") Contained in Appendix C3 of the Listing Rules](index=35&type=section&id=Compliance%20with%20the%20Model%20Code%20for%20Securities%20Transactions%20by%20Directors%20of%20Listed%20Issuers%20(%22Model%20Code%22)%20Contained%20in%20Appendix%20C3%20of%20the%20Listing%20Rules) The Company has adopted the Model Code to regulate directors' securities transactions, and all directors confirmed compliance during the reporting period, with no breaches found among relevant employees; the Company also has an inside information policy in place - The Company has adopted the Model Code as its code of conduct for securities transactions by Directors[106](index=106&type=chunk) - All Directors confirmed compliance with the Model Code during the reporting period[106](index=106&type=chunk) - The Company has also established an inside information policy to fulfill its obligations under the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) and the Listing Rules[106](index=106&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=36&type=section&id=Purchase,%20Sale%20or%20Redemption%20of%20the%20Company's%20Listed%20Securities) During the reporting period, neither the Company nor any of its subsidiaries or consolidated affiliated entities purchased, redeemed, or sold any of the Company's or its subsidiaries' listed securities, and as of June 30, 2025, the Company held no treasury shares - During the reporting period, neither the Company nor any of its subsidiaries or consolidated affiliated entities purchased, redeemed, or sold any of the Company's or its subsidiaries' listed securities[107](index=107&type=chunk) - As of June 30, 2025, the Company held no treasury shares[107](index=107&type=chunk) [Interim Dividends](index=36&type=section&id=Interim%20Dividends) The Board of Directors declared no interim dividend for the six months ended June 30, 2025, consistent with the prior year - The Board of Directors declared no interim dividend for the six months ended June 30, 2025 (for the six months ended June 30, 2024: nil)[108](index=108&type=chunk) [Audit Committee](index=36&type=section&id=Audit%20Committee) The Audit Committee has r