[Performance](index=1&type=section&id=Performance) [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=1&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) The Group achieved a pre-tax profit of $191 million in H1 2025, a 163.9% YoY increase, driven by significant gains from financial assets at fair value through profit or loss Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the six months ended June 30) | Indicator | 2025 (USD) | 2024 (USD) | | :--- | :--- | :--- | | Net gains from financial assets at fair value through profit or loss | 188,753,524 | 75,152,945 | | Investment income | 1,693,182 | 1,931,659 | | Other net income | 1,486,274 | 719,136 | | Administrative expenses | (1,094,013) | (5,493,400) | | Profit before tax | 190,838,967 | 72,310,340 | | Tax | (50,386,281) | (12,806,848) | | Profit for the period | 140,452,686 | 59,503,492 | | Total comprehensive income for the period | 142,432,301 | 56,610,309 | | Profit attributable to shareholders of the Company for the period | 140,452,686 | 59,503,492 | | Total comprehensive income attributable to shareholders of the Company for the period | 142,432,301 | 56,610,309 | | Basic earnings per share | 0.922 | 0.391 | - Profit attributable to shareholders of the Company was **$140,452,686**, a **136.05%** increase from **$59,503,492** in the prior year[3](index=3&type=chunk) [Condensed Consolidated Statement of Financial Position](index=2&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group's total net assets increased to $784 million, up 21.06% from end-2024, primarily due to a substantial increase in financial assets at fair value through profit or loss Condensed Consolidated Statement of Financial Position (As of June 30) | Indicator | June 30, 2025 (USD) | December 31, 2024 (USD) | | :--- | :--- | :--- | | **Non-current assets** | | | | Financial assets at fair value through profit or loss | 955,982,410 | 770,688,567 | | **Current assets** | | | | Financial assets at fair value through profit or loss | 9,000,618 | 4,964,102 | | Other receivables and prepayments | 1,078,767 | 194,801 | | Cash and cash equivalents | 26,609,215 | 30,946,711 | | **Current liabilities** | | | | Other payables | 25,566,680 | 26,541,098 | | Dividends payable | 6,093,321 | - | | Tax payable | 433,104 | 7,272,419 | | **Non-current liabilities** | | | | Financial liabilities designated at fair value through profit or loss | 1,828,740 | 1,153,126 | | Deferred tax | 175,032,280 | 124,449,633 | | **Net assets** | 783,716,885 | 647,377,905 | | **Equity attributable to shareholders of the Company** | 783,716,885 | 647,377,905 | | Net asset value per share | 5.145 | 4.250 | - As of June 30, 2025, net assets increased to **$783,716,885**, a **21.06%** increase from **$647,377,905** as of December 31, 2024[4](index=4&type=chunk) [Notes to the Condensed Consolidated Financial Information](index=3&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Information) [1. Basis of Preparation](index=3&type=section&id=1.%20Basis%20of%20Preparation) This condensed consolidated financial information is prepared in accordance with HKAS 34 and Appendix D2 of the HKEX Listing Rules, with 2024 financial data extracted and filed with an unqualified auditor's report - This condensed consolidated financial information is prepared in accordance with **HKAS 34** and **Appendix D2** of the Listing Rules[5](index=5&type=chunk) - The statutory consolidated financial statements for the year ended December 31, 2024, have been filed with the Companies Registry, and the auditor's report was unqualified[5](index=5&type=chunk) [2. Significant Accounting Policies](index=3&type=section&id=2.%20Significant%20Accounting%20Policies) This condensed consolidated financial information is prepared on a historical cost basis, with certain financial instruments measured at fair value, consistent with the 2024 annual consolidated financial statements - The condensed consolidated financial information is prepared on a historical cost basis, with certain financial instruments measured at fair value[6](index=6&type=chunk) - The accounting policies and methods of computation adopted are consistent with those followed in the consolidated financial statements for the year ended December 31, 2024[6](index=6&type=chunk) [3. Net Gains from Financial Assets at Fair Value Through Profit or Loss](index=4&type=section&id=3.%20Net%20Gains%20from%20Financial%20Assets%20at%20Fair%20Value%20Through%20Profit%20or%20Loss) Net gains from financial assets at fair value through profit or loss significantly increased by 151.16% to $189 million this period, primarily driven by unrealized gains, with listed investments contributing the most Net Gains (Losses) from Financial Assets at Fair Value Through Profit or Loss (For the six months ended June 30) | Indicator | 2025 (USD) | 2024 (USD) | | :--- | :--- | :--- | | **Listed investments** | | | | Realized | 1,070,678 | - | | Unrealized | 150,049,516 | 45,574,217 | | **Unlisted investments** | | | | Realized | 6,170 | (51,829) | | Unrealized | 37,627,160 | 29,630,557 | | **Total** | 188,753,524 | 75,152,945 | - Net gains from financial assets at fair value through profit or loss significantly increased by **151.16%** from **$75,152,945** in 2024 to **$188,753,524** in 2025[7](index=7&type=chunk) [4. Investment Income](index=4&type=section&id=4.%20Investment%20Income) Investment income for the period was $1.69 million, a 12.44% YoY decrease, mainly due to reduced dividend income from financial assets at fair value through profit or loss Investment Income (For the six months ended June 30) | Indicator | 2025 (USD) | 2024 (USD) | | :--- | :--- | :--- | | Bank deposit interest income | 266,516 | 304,361 | | Dividend income from financial assets at fair value through profit or loss | 1,426,666 | 1,627,298 | | **Total** | 1,693,182 | 1,931,659 | - Total investment income decreased by **12.44%** from **$1,931,659** in 2024 to **$1,693,182** in 2025[8](index=8&type=chunk) [5. Segment Information](index=5&type=section&id=5.%20Segment%20Information) The Group primarily invests in financial services, culture, media & consumption, and information technology segments, with IT contributing the highest net gains from financial assets in H1 2025 [5.1 Segment Performance for the Six Months Ended June 30, 2025](index=5&type=section&id=5.1%20Segment%20Performance%20for%20the%20Six%20Months%20Ended%20June%2030,%202025) Analysis of Reported Segment Profit for H1 2025 | Reported Segment | Financial Services (USD) | Culture, Media & Consumption (USD) | Information Technology (USD) | Total (USD) | Others (USD) | Consolidated Total (USD) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Net gains (losses) from financial assets at fair value through profit or loss | 78,694,748 | (2,126,400) | 112,003,648 | 188,571,996 | 181,528 | 188,753,524 | | Dividend income from financial assets at fair value through profit or loss | - | 1,426,666 | - | 1,426,666 | - | 1,426,666 | | Other income | - | 1,587,021 | - | 1,587,021 | - | 1,587,021 | | Segment profit | 78,694,748 | 887,287 | 112,003,648 | 191,585,683 | 181,528 | 191,767,211 | - In H1 2025, the Information Technology segment performed strongly in net gains from financial assets at fair value through profit or loss, contributing **$112 million**[13](index=13&type=chunk) [5.2 Segment Performance for the Six Months Ended June 30, 2024](index=6&type=section&id=5.2%20Segment%20Performance%20for%20the%20Six%20Months%20Ended%20June%2030,%202024) Analysis of Reported Segment Profit for H1 2024 | Reported Segment | Financial Services (USD) | Culture, Media & Consumption (USD) | Information Technology (USD) | Total (USD) | Others (USD) | Consolidated Total (USD) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Net gains (losses) from financial assets at fair value through profit or loss | 60,430,924 | 5,357,508 | 12,437,976 | 78,226,408 | (3,073,463) | 75,152,945 | | Dividend income from financial assets at fair value through profit or loss | - | 1,627,298 | - | 1,627,298 | - | 1,627,298 | | Other income | - | 1,290,176 | - | 1,290,176 | - | 1,290,176 | | Segment profit (loss) | 60,430,924 | 8,274,982 | 12,437,976 | 81,143,882 | (3,073,463) | 78,070,419 | - In H1 2024, the Financial Services segment was the main contributor to net gains from financial assets at fair value through profit or loss, contributing **$60.43 million**[15](index=15&type=chunk) [5.3 Analysis of Segment Assets and Liabilities](index=7&type=section&id=5.3%20Analysis%20of%20Segment%20Assets%20and%20Liabilities) Segment Assets and Liabilities (As of June 30) | Indicator | June 30, 2025 (USD) | December 31, 2024 (USD) | | :--- | :--- | :--- | | **Segment assets** | | | | Financial Services | 549,645,729 | 473,715,575 | | Culture, Media & Consumption | 47,600,668 | 51,369,555 | | Information Technology | 356,316,030 | 239,344,269 | | Total reported segment assets | 953,562,427 | 764,429,399 | | Others | 11,420,601 | 11,223,270 | | Unallocated items | 27,687,982 | 31,141,512 | | **Consolidated assets** | 992,671,010 | 806,794,181 | | **Segment liabilities** | | | | Financial Services | 48,634 | 70,971 | | Culture, Media & Consumption | 21,716 | 60,916 | | Information Technology | 1,689,142 | 951,004 | | Total reported segment liabilities | 1,759,492 | 1,082,891 | | Others | 69,248 | 70,235 | | Unallocated items | 207,125,385 | 158,263,150 | | **Consolidated liabilities** | 208,954,125 | 159,416,276 | - As of June 30, 2025, the Financial Services segment's total assets were **$550 million**, accounting for **57.6%** of total reported segment assets[16](index=16&type=chunk) - Information Technology segment assets increased to **$356 million**, and consolidated liabilities increased to **$209 million**[16](index=16&type=chunk) [5.4 Geographical Information](index=7&type=section&id=5.4%20Geographical%20Information) The Group's principal business is investing in companies primarily operating in China, thus no geographical information related to investment activities is presented - The Group's principal business is investing in companies primarily operating in China, thus no geographical information related to investment activities is presented[17](index=17&type=chunk) [6. Profit Before Tax](index=8&type=section&id=6.%20Profit%20Before%20Tax) Profit before tax for H1 2025 was $191 million, after deducting investment manager management fees of $0.6377 million (a significant YoY decrease) and net exchange losses of $0.1007 million Deductions from Profit Before Tax (For the six months ended June 30) | Item | 2025 (USD) | 2024 (USD) | | :--- | :--- | :--- | | Investment manager management fees | 637,680 | 5,090,487 | | Net exchange losses | 100,747 | 571,066 | - Investment manager management fees significantly decreased from **$5,090,487** in 2024 to **$637,680** in 2025[18](index=18&type=chunk) [7. Tax](index=8&type=section&id=7.%20Tax) Total tax for the period was $50.39 million, primarily comprising deferred tax of $50.10 million, with China corporate income tax being a negative $0.2867 million Tax Provision for the Period (For the six months ended June 30) | Item | 2025 (USD) | 2024 (USD) | | :--- | :--- | :--- | | Current tax: China corporate income tax | (286,653) | (774,230) | | Deferred tax: Current period | (50,099,628) | (12,032,618) | | **Total** | (50,386,281) | (12,806,848) | - The Company and its subsidiaries made no provision for Hong Kong tax for the period, as there was no assessable profit[18](index=18&type=chunk) - Deferred tax provision has been made in the condensed consolidated financial information for temporary differences arising from retained profits of domestic subsidiaries[19](index=19&type=chunk) [8. Basic Earnings Per Share](index=9&type=section&id=8.%20Basic%20Earnings%20Per%20Share) Basic earnings per share for H1 2025 was $0.922, a substantial 135.8% increase from $0.391 in the prior year, with the number of ordinary shares outstanding remaining unchanged Basic Earnings Per Share Calculation (For the six months ended June 30) | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Profit used for basic earnings per share calculation (USD) | 140,452,686 | 59,503,492 | | Number of ordinary shares used for basic earnings per share calculation | 152,333,013 | 152,333,013 | | **Basic earnings per share (USD)** | 0.922 | 0.391 | - Basic earnings per share increased by **135.8%** from **$0.391** in 2024 to **$0.922** in 2025[20](index=20&type=chunk) [9. Net Asset Value Per Share](index=9&type=section&id=9.%20Net%20Asset%20Value%20Per%20Share) As of June 30, 2025, net asset value per share was $5.145, a 21.06% increase from $4.250 as of December 31, 2024 Net Asset Value Per Share Calculation (As of June 30) | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Net assets (USD) | 783,716,885 | 647,377,905 | | Number of ordinary shares outstanding | 152,333,013 | 152,333,013 | | **Net asset value per share (USD)** | 5.145 | 4.250 | - Net asset value per share increased by **21.06%** from **$4.250** as of December 31, 2024, to **$5.145** as of June 30, 2025[21](index=21&type=chunk) [10. Movements in Reserves and Retained Profits](index=9&type=section&id=10.%20Movements%20in%20Reserves%20and%20Retained%20Profits) As of June 30, 2025, the Group's reserves and retained profits balance increased to $644 million, positively impacted by current period profit of $140 million and exchange differences of $1.98 million Movements in Reserves and Retained Profits (For the six months ended June 30) | Indicator | 2025 (USD) | 2024 (USD) | | :--- | :--- | :--- | | Balance at January 1 | 508,029,120 | 418,591,003 | | Movements in reserves | 1,979,615 | (2,893,183) | | Profit for the period | 140,452,686 | 59,503,492 | | Dividends declared for prior year | (6,093,321) | (12,186,641) | | **Balance at June 30** | 644,368,100 | 463,014,671 | [10.1 Dividend Distribution Policy and Details](index=10&type=section&id=10.1%20Dividend%20Distribution%20Policy%20and%20Details) - The Board resolved to declare an interim dividend of **4 US cents** per share and a special interim dividend of **4 US cents** per share for H1 2025, totaling **8 US cents** per share (equivalent to HK$0.624)[23](index=23&type=chunk) - The total dividend amounted to **$12,186,641**, doubling from **$6,093,321** in the same period of 2024[23](index=23&type=chunk) - The final dividend for 2024 of **$6,093,321** (**4 US cents** per share) was paid on July 25, 2025[24](index=24&type=chunk) [Suspension of Share Register Closure](index=10&type=section&id=Suspension%20of%20Share%20Register%20Closure) To determine eligibility for interim and special interim dividends, the Company will suspend share transfer registration from September 22 to September 25, 2025 - The Company will suspend share transfer registration from **September 22, 2025, to September 25, 2025** (both dates inclusive)[25](index=25&type=chunk) - All share transfer documents must be lodged with the share registrar by **4:30 p.m. on September 19, 2025**, to qualify for the interim and special interim dividends[25](index=25&type=chunk) [Review and Outlook](index=10&type=section&id=Review%20and%20Outlook) [Overall Performance](index=10&type=section&id=Overall%20Performance) The Group's profit attributable to shareholders reached $140 million in H1 2025, a significant 136.05% YoY increase, primarily due to financial asset appreciation, especially from Insta360's listing - The Group's profit attributable to shareholders for the six months ended June 30, 2025, was **$140 million**, a **136.05%** year-on-year increase[26](index=26&type=chunk) - The profit growth was mainly due to a significant increase in the overall appreciation rate of financial assets at fair value through profit or loss, particularly from the listing of Insta360[26](index=26&type=chunk) - Net gains from financial assets for the period were **$189 million**, a substantial **151.16%** increase from the prior year[26](index=26&type=chunk) - Investment income for the period decreased by **12.44%** year-on-year to **$1.69 million**, mainly due to reduced dividend income from investment projects[28](index=28&type=chunk) [Project Investments and Exits](index=11&type=section&id=Project%20Investments%20and%20Exits) In H1 2025, the Group invested in JBD, a MicroLED R&D and manufacturing company, and exited three projects, with CICC H-shares achieving a 101.69% pre-tax IRR - In H1 2025, the Group completed an investment in Shanghai Jade Bird Display Technology Co., Ltd. (JBD), subscribing for **0.449%** equity for **RMB 30 million** (equivalent to **$4.18 million**)[29](index=29&type=chunk) - The Group sold all its A-shares in Oriental Pearl New Media Co., Ltd., realizing net proceeds of **RMB 44.66 million** (equivalent to **$6.69 million**), with a pre-tax internal rate of return of **negative 14.33%**[30](index=30&type=chunk) - The Group sold all its H-shares in China International Capital Corporation Limited, realizing net proceeds of **HK$33.98 million** (equivalent to **$4.37 million**), with a pre-tax internal rate of return of **101.69%**[30](index=30&type=chunk) - The Group transferred its entire **20%** equity interest in Yunnan Jinlanmei International Tourism Investment Development Co., Ltd., recovering **RMB 2.79 million** (equivalent to **$0.39 million**), with a pre-tax internal rate of return of **negative 13.91%**[30](index=30&type=chunk) [Liquidity, Financial Resources, Liabilities, and Commitments](index=12&type=section&id=Liquidity,%20Financial%20Resources,%20Liabilities,%20and%20Commitments) As of June 30, 2025, the Group's cash and cash equivalents decreased by 14.02% to $26.61 million, primarily due to the JBD project investment payment, with no bank loans or commitments - The Group's cash and cash equivalents balance as of June 30, 2025, was **$26.61 million**, a **14.02%** decrease from the end of the previous year, mainly due to the payment for the JBD project investment[32](index=32&type=chunk) - As of June 30, 2025, the Group had no bank loans[33](index=33&type=chunk) - As of June 30, 2025, the Group had no commitments[34](index=34&type=chunk) [Exchange Rate Fluctuation Risk and Related Hedging](index=12&type=section&id=Exchange%20Rate%20Fluctuation%20Risk%20and%20Related%20Hedging) The RMB appreciated slightly by 0.30% against the USD in H1 2025, benefiting the Group's RMB-denominated assets, with ongoing monitoring for potential hedging of significant foreign currency risks - In H1 2025, the RMB exchange rate against the USD recorded a slight increase of **0.30%**, which had a favorable impact on the Group, which holds a significant amount of RMB-denominated assets[35](index=35&type=chunk) - The Group currently has no foreign currency hedging policy but will continue to monitor foreign currency exchange risks and consider hedging significant foreign currency risks when necessary[35](index=35&type=chunk) [Employees](index=12&type=section&id=Employees) The Group has no employees other than a qualified accountant whose remuneration is paid by the investment manager, with the investment portfolio and company affairs managed by the investment manager - The Group has no employees other than a qualified accountant whose remuneration is determined and paid by the investment manager[36](index=36&type=chunk) - The Group's investment portfolio and company affairs are managed by the investment manager[36](index=36&type=chunk) [Investment Portfolio](index=12&type=section&id=Investment%20Portfolio) As of June 30, 2025, the Group's total investment value was $965 million, with financial services accounting for 55.38%, information technology for 35.90%, and culture, media & consumption for 4.80% - The Group's total investment value as of June 30, 2025, was **$965 million**[37](index=37&type=chunk) Investment Portfolio Category Distribution (As of June 30, 2025) | Category | Total Investment Value (USD) | Proportion of Total Group Assets | | :--- | :--- | :--- | | Financial Services | 549,645,729 | 55.38% | | Culture, Media & Consumption | 47,600,668 | 4.80% | | Information Technology | 356,316,030 | 35.90% | | Others (including manufacturing, energy & resources, and healthcare) | 11,420,601 | 1.15% | | Cash and cash equivalents | 26,610,000 | 2.68% | [Business Outlook and Investment Strategy](index=12&type=section&id=Business%20Outlook%20and%20Investment%20Strategy) China's economy showed stable growth in H1 2025 with a 5.3% GDP increase, while the Group will focus on digital finance, AI, cultural tourism, and healthcare for investment and asset reallocation amidst global economic slowdown - China's Gross Domestic Product (GDP) for H1 2025 was **RMB 66 trillion**, a **5.3%** year-on-year increase[38](index=38&type=chunk) - The World Bank projects global growth to slow to **2.3%** in 2025, facing trade barriers and policy uncertainties[39](index=39&type=chunk) - Looking ahead to H2, the foundation for China's economic recovery and improvement still needs to be strengthened, with an expected full-year GDP growth target of around **5.0%** for 2025[39](index=39&type=chunk) - The Group's investment direction will focus on the financial industry (primarily digital finance), emerging technology industries (primarily artificial intelligence), the cultural industry (primarily cultural tourism), and the healthcare industry (primarily medical health)[40](index=40&type=chunk) [Other Significant Matters](index=14&type=section&id=Other%20Significant%20Matters) [Purchase, Sale, or Redemption of the Company's Shares](index=14&type=section&id=Purchase,%20Sale,%20or%20Redemption%20of%20the%20Company's%20Shares) For the six months ended June 30, 2025, neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's shares - For the six months ended June 30, 2025, neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's shares[42](index=42&type=chunk) [Material Events After the Financial Period End](index=14&type=section&id=Material%20Events%20After%20the%20Financial%20Period%20End) As of the date of this earnings announcement, no material events affecting the Group have occurred after the financial period end - As of the date of this earnings announcement, no material events affecting the Group have occurred after the financial period end[43](index=43&type=chunk) [Corporate Governance and Directors' Securities Transactions](index=14&type=section&id=Corporate%20Governance%20and%20Directors'%20Securities%20Transactions) The Company complied with all applicable Corporate Governance Code provisions, except for a remuneration committee exemption, and all directors confirmed compliance with the Model Code for securities transactions - The Company has complied with all applicable code provisions contained in Appendix C1, the Corporate Governance Code, of the Listing Rules[44](index=44&type=chunk) - The Company is exempted from establishing a remuneration committee as executive directors and senior management will not receive any directors' fees or remuneration from the Company[44](index=44&type=chunk) - All directors confirmed compliance with the required standards set out in the Model Code for Securities Transactions by Directors of Listed Issuers for the reporting period[45](index=45&type=chunk)

[Report Overview](index=1&type=section&id=%E5%A0%B1%E5%91%8A%E6%A6%82%E8%A6%BD) [GEM Characteristics and Company Statement](index=2&type=section&id=GEM%E7%89%B9%E8%89%B2%E5%8F%8A%E5%85%AC%E5%8F%B8%E8%81%B2%E6%98%8E) The company's 2025 interim report highlights the GEM market's nature for SMEs, which involves higher investment risks, and affirms the directors' joint responsibility for the report's accuracy - The GEM market is positioned for small and medium-sized companies, entailing **higher investment risks and greater market volatility**[3](index=3&type=chunk) - The company's directors confirm that the report's information is **accurate and complete in all material respects**, without any misleading or fraudulent elements[3](index=3&type=chunk) [Financial Performance](index=3&type=section&id=%E8%B2%A1%E5%8B%99%E6%A5%AD%E7%B8%BE) [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=3&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%90%8D%E7%9B%8A%E5%8F%8A%E5%85%B6%E4%BB%96%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) For the six months ended June 30, 2025, the Group achieved a significant turnaround with a net profit of HK$2,326 thousand, driven primarily by substantial revenue growth Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the six months ended June 30) | Metric | 2025 (HK$'000) | 2024 (HK$'000) | | :--- | :--- | :--- | | Revenue | 136,290 | 93,037 | | Other income | 873 | 623 | | Staff costs | (121,271) | (80,511) | | Other expenses and losses | (12,435) | (15,579) | | Finance costs | (418) | (96) | | Profit (loss) before tax | 3,295 | (2,555) | | Income tax (expense) credit | (969) | 89 | | Profit (loss) for the period | 2,326 | (2,466) | | Total comprehensive income (expense) for the period | 2,591 | (2,693) | | Earnings (loss) per share – basic and diluted (HK cents) | 0.29 | (0.31) | - **Revenue grew by 46.5% year-on-year** to HK$136,290 thousand, a key factor in achieving profitability[5](index=5&type=chunk) - Basic earnings per share turned from a loss of 0.31 HK cents in the prior-year period to **earnings of 0.29 HK cents**[5](index=5&type=chunk) [Condensed Consolidated Statement of Financial Position](index=4&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) As of June 30, 2025, the Group's net assets increased to HK$60,754 thousand, with net current assets remaining robust despite a rise in current liabilities due to new bank borrowings Condensed Consolidated Statement of Financial Position (As of June 30, 2025) | Metric | June 30, 2025 (HK$'000) | December 31, 2024 (HK$'000) | | :--- | :--- | :--- | | Non-current assets | 13,234 | 15,148 | | Current assets | 76,923 | 68,554 | | Current liabilities | 24,346 | 18,836 | | Net current assets | 52,577 | 49,718 | | Non-current liabilities | 5,057 | 6,703 | | Net assets | 60,754 | 58,163 | | Total equity | 60,754 | 58,163 | - Current liabilities increased from HK$18,836 thousand on December 31, 2024, to HK$24,346 thousand on June 30, 2025, mainly due to **new bank borrowings of HK$8,000 thousand**[6](index=6&type=chunk) - Trade and other receivables rose from HK$40,547 thousand to HK$52,165 thousand, reflecting **expanded business activities**[6](index=6&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) For the six months ended June 30, 2025, the Group's total equity increased to HK$60,754 thousand, primarily driven by the profit for the period and other comprehensive income Condensed Consolidated Statement of Changes in Equity (For the six months ended June 30) | Metric | June 30, 2025 (HK$'000) | June 30, 2024 (HK$'000) | | :--- | :--- | :--- | | Total equity at the beginning of the period | 58,163 | 61,229 | | Profit (loss) for the period | 2,326 | (2,466) | | Other comprehensive income (expense) for the period | 265 | (227) | | Total equity at the end of the period | 60,754 | 58,536 | - **Retained earnings increased** from HK$11,554 thousand as of December 31, 2024, to HK$13,880 thousand as of June 30, 2025[8](index=8&type=chunk) - Exchange differences on translation of foreign operations shifted from an expense of HK$227 thousand in the same period of 2024 to an **income of HK$265 thousand**[8](index=8&type=chunk) [Condensed Consolidated Statement of Cash Flows](index=7&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E7%8F%BE%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) For the six months ended June 30, 2025, the Group's net decrease in cash and cash equivalents was HK$2,935 thousand, reflecting a combination of operating outflows and financing inflows Condensed Consolidated Statement of Cash Flows (For the six months ended June 30) | Activity | 2025 (HK$'000) | 2024 (HK$'000) | | :--- | :--- | :--- | | Net cash used in operating activities | (8,186) | (7,994) | | Net cash from (used in) investing activities | (162) | 109 | | Net cash from (used in) financing activities | 5,413 | (3,217) | | Net decrease in cash and cash equivalents | (2,935) | (11,102) | | Cash and cash equivalents at end of period | 21,893 | 23,421 | - Net cash from financing activities shifted from a net outflow of HK$3,217 thousand to a **net inflow of HK$5,413 thousand**, mainly due to raising HK$8,000 thousand in bank borrowings[9](index=9&type=chunk) - Net cash used in operating activities **slightly increased** from HK$7,994 thousand to HK$8,186 thousand[9](index=9&type=chunk) [Notes to the Financial Statements](index=8&type=section&id=%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8%E9%99%84%E8%A8%BB) [General Information](index=8&type=section&id=%E4%B8%80%E8%88%AC%E8%B3%87%E6%96%99) The Company, incorporated in the Cayman Islands and listed on GEM, primarily provides recruitment and secondment services in Hong Kong, Macau, Mainland China, and Singapore - The Company was **listed on the GEM of the Stock Exchange on October 12, 2018**[11](index=11&type=chunk) - Its principal business activities are providing **recruitment services and/or secondment and payroll services** in Hong Kong, Macau, Mainland China, and Singapore[11](index=11&type=chunk) - The financial statements are presented in Hong Kong dollars and are **unaudited but have been reviewed by the Audit Committee**[12](index=12&type=chunk)[13](index=13&type=chunk) [Basis of Preparation and Principal Accounting Policies](index=9&type=section&id=%E7%B7%A8%E8%A3%BD%E5%9F%BA%E6%準%E5%8F%8A%E4%B8%BB%E8%A6%81%E6%9C%83%E8%A8%88%E6%94%BF%E7%AD%96) The condensed consolidated financial statements are prepared on a historical cost basis in compliance with HKAS 34 and the GEM Listing Rules, with no material impact from new HKFRSs - The financial statements are prepared on the **historical cost basis** and in accordance with Hong Kong Accounting Standard 34 and Chapter 18 of the GEM Listing Rules[14](index=14&type=chunk) - The application of new and revised Hong Kong Financial Reporting Standards in the current period has had **no material effect** on the financial statements[14](index=14&type=chunk) [Revenue and Segment Information](index=10&type=section&id=%E6%94%B6%E7%9B%8A%E5%8F%8A%E5%88%86%E9%83%A8%E8%B3%87%E6%96%99) The Group's total revenue grew significantly by 46.5% to HK$136,290 thousand, driven by strong performance in secondment and payroll services, with Hong Kong as the main contributor Revenue Breakdown (For the six months ended June 30) | Service Type | Region | 2025 (HK$'000) | 2024 (HK$'000) | | :--- | :--- | :--- | :--- | | Recruitment services | Hong Kong | 27,646 | 26,352 | | | Mainland China | 8,021 | 8,457 | | | Singapore | 1,291 | 1,954 | | **Total Recruitment services** | | **36,958** | **36,763** | | Secondment and payroll services | Hong Kong | 96,840 | 54,803 | | | Macau | 1,882 | 1,471 | | | Mainland China | 610 | – | | **Total Secondment and payroll services** | | **99,332** | **56,274** | | **Total** | | **136,290** | **93,037** | - Revenue from secondment and payroll services **surged by 76.5%** to HK$99,332 thousand, becoming the primary growth driver[15](index=15&type=chunk) - The Group operates in a **single operating segment**, human resources services, with the chief operating decision maker reviewing overall revenue and results[16](index=16&type=chunk) Revenue Contribution from Major Customers (For the six months ended June 30) | Customer | 2025 (HK$'000) | 2024 (HK$'000) | | :--- | :--- | :--- | | Customer A | 19,234 | 10,837 | | Customer B | 16,749 | – | [Finance Costs](index=11&type=section&id=%E8%9E%8D%E8%B3%87%E6%88%90%E6%9C%AC) For the six months ended June 30, 2025, finance costs increased significantly to HK$418 thousand, mainly due to interest on lease liabilities and new bank borrowings Finance Costs (For the six months ended June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | | :--- | :--- | :--- | | Interest on lease liabilities | 289 | 85 | | Interest on bank borrowings | 114 | – | | Interest on provision for reinstatement costs | 15 | 11 | | **Total** | **418** | **96** | - Interest on bank borrowings is a **new finance cost item** in the current period[20](index=20&type=chunk) [Income Tax (Expense) Credit](index=12&type=section&id=%E6%89%80%E5%BE%97%E7%A8%85%EF%BC%88%E9%96%8B%E6%94%AF%EF%BC%89%E6%8A%B5%E5%85%8D) For the six months ended June 30, 2025, income tax expense rose to HK$969 thousand due to higher estimated assessable profits from operating subsidiaries Income Tax (Expense) Credit (For the six months ended June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | | :--- | :--- | :--- | | Current tax – Hong Kong Profits Tax | 969 | 360 | | Current tax – Singapore Corporate Income Tax | – | 17 | | Over-provision in prior years | – | (466) | | **Total** | **969** | **(89)** | - Hong Kong Profits Tax is calculated at **16.5%** of the estimated assessable profits, with a concessionary rate of **8.25%** on the first HK$2 million for qualifying entities[21](index=21&type=chunk) - No provision for corporate income tax was made for subsidiaries in Mainland China as they had **no assessable profits**[22](index=22&type=chunk) [Earnings (Loss) Per Share](index=13&type=section&id=%E6%AF%8F%E8%82%A1%E7%9B%88%E5%88%A9%EF%BC%88%E8%99%A7%E6%90%8D%EF%BC%89) For the six months ended June 30, 2025, basic earnings per share attributable to owners of the Company was 0.29 HK cents, a positive turnaround from the prior period's loss Earnings (Loss) Per Share (For the six months ended June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Profit (loss) for the period (HK$'000) | 2,326 | (2,466) | | Weighted average number of ordinary shares ('000) | 800,000 | 800,000 | | Basic earnings (loss) per share (HK cents) | 0.29 | (0.31) | - As there were **no potential ordinary shares in issue** during the reporting period, diluted earnings (loss) per share has not been presented[24](index=24&type=chunk) [Dividend](index=13&type=section&id=%E8%82%A1%E6%81%AF) The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025, consistent with the prior year period - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025 (2024: **Nil**)[25](index=25&type=chunk) [Movements in Property, Plant and Equipment and Right-of-Use Assets](index=13&type=section&id=%E7%89%A9%E6%A5%AD%E3%80%81%E5%BB%A0%E6%88%BF%E5%8F%8A%E8%A8%AD%E5%82%99%E4%BB%A5%E5%8F%8A%E4%BD%BF%E7%94%A8%E6%AC%8A%E8%B3%87%E7%94%A2%E8%AE%8A%E5%8B%95) The Group purchased property, plant and equipment costing approximately HK$169 thousand during the period, with changes in right-of-use assets due to new office leases - During the six months ended June 30, 2025, the Group purchased items of property, plant and equipment with a total cost of approximately **HK$169 thousand**[26](index=26&type=chunk) - The Group entered into a new lease agreement for its Shanghai office on May 10, 2025, recognizing a right-of-use asset of approximately **HK$465 thousand**[27](index=27&type=chunk) - The Group entered into a new lease agreement for its Singapore office on January 17, 2024, recognizing a right-of-use asset of approximately **HK$741 thousand**[27](index=27&type=chunk) [Trade and Other Receivables and Rental Deposits](index=14&type=section&id=%E6%87%89%E6%94%B6%E8%B3%84%E6%AC%BE%E5%8F%8A%E5%85%B6%E4%BB%96%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85%E4%BB%A5%E5%8F%8A%E7%A7%9F%E9%87%91%E6%8C%89%E9%87%91) As of June 30, 2025, gross trade receivables increased to HK$50,637 thousand, with a reduced provision for expected credit losses and a credit period generally not exceeding 60 days Trade and Other Receivables (As of June 30, 2025) | Item | June 30, 2025 (HK$'000) | December 31, 2024 (HK$'000) | | :--- | :--- | :--- | | Trade receivables | 50,637 | 40,116 | | Less: Provision for expected credit losses | (1,086) | (1,284) | | **Net trade receivables** | **49,551** | **38,832** | | Other receivables | 4,032 | 3,099 | | **Total trade and other receivables** | **53,583** | **41,831** | Ageing Analysis of Trade Receivables (As of June 30, 2025) | Ageing | June 30, 2025 (HK$'000) | December 31, 2024 (HK$'000) | | :--- | :--- | :--- | | Within 30 days | 36,884 | 29,589 | | 31 to 60 days | 8,525 | 4,316 | | 61 to 90 days | 1,867 | 1,574 | | 91 to 180 days | 2,275 | 2,914 | | Over 180 days | – | 439 | | **Total** | **49,551** | **38,832** | - The provision for expected credit losses **decreased** from HK$1,284 thousand to HK$1,086 thousand[28](index=28&type=chunk) [Financial Assets at Fair Value Through Profit or Loss](index=15&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%E9%87%91%E8%9E%8D%E8%B3%87%E7%94%A2) As of June 30, 2025, the Group held listed equity securities in Hong Kong for trading purposes, valued at HK$465 thousand, a slight increase from the previous year-end Financial Assets at Fair Value Through Profit or Loss (As of June 30, 2025) | Item | June 30, 2025 (HK$'000) | December 31, 2024 (HK$'000) | | :--- | :--- | :--- | | Listed equity securities in Hong Kong held for trading | 465 | 419 | - The fair value of listed securities is based on **quoted bid prices in an active market** in Hong Kong[32](index=32&type=chunk) [Other Payables, Accruals and Contract Liabilities](index=16&type=section&id=%E5%85%B6%E4%BB%96%E6%87%89%E4%BB%98%E6%AC%BE%E9%A0%85%E5%8F%8A%E6%87%89%E8%A8%88%E8%B2%BB%E7%94%A8%E5%8F%8A%E5%90%88%E7%B4%84%E8%B2%A0%E5%82%B5) As of June 30, 2025, total other payables and accruals amounted to HK$11,481 thousand, a decrease from the previous year-end mainly due to lower accrued payroll expenses Other Payables and Accruals (As of June 30, 2025) | Item | June 30, 2025 (HK$'000) | December 31, 2024 (HK$'000) | | :--- | :--- | :--- | | Other payables | 1,795 | 2,467 | | Accrued expenses | 669 | 1,117 | | Accrued payroll expenses | 9,017 | 10,862 | | **Total** | **11,481** | **14,446** | Contract Liabilities (As of June 30, 2025) | Item | June 30, 2025 (HK$'000) | December 31, 2024 (HK$'000) | | :--- | :--- | :--- | | Secondment and payroll services | 193 | 193 | - Accrued payroll expenses **decreased** from HK$10,862 thousand to HK$9,017 thousand[33](index=33&type=chunk) [Bank Borrowings](index=16&type=section&id=%E9%8A%80%E8%A1%8C%E5%80%9F%E6%AC%BE) As of June 30, 2025, the Group secured new bank borrowings of HK$8,000 thousand, bearing interest at HIBOR or cost of funds plus a margin of 1.7% to 3% per annum Bank Borrowings (As of June 30, 2025) | Item | June 30, 2025 (HK$'000) | December 31, 2024 (HK$'000) | | :--- | :--- | :--- | | Bank borrowings, secured | 8,000 | – | - The secured bank borrowings bear interest at the **Hong Kong Interbank Offered Rate (HIBOR)** or cost of funds plus a margin of 1.7% to 3% per annum[35](index=35&type=chunk) [Contingent Liabilities](index=16&type=section&id=%E6%88%96%E7%84%B6%E8%B2%A0%E5%82%B5) As of June 30, 2025, the Group had no significant contingent liabilities, consistent with the position at the end of the previous year - At June 30, 2025, the Group did not have any significant contingent liabilities (December 31, 2024: **Nil**)[36](index=36&type=chunk) [Fair Value Measurement of Financial Instruments](index=17&type=section&id=%E9%87%91%E8%9E%8D%E5%B7%A5%E5%85%B7%E5%85%AC%E5%B9%B3%E5%80%BC%E8%A8%88%E9%87%8F) The Group's financial instruments measured at fair value include listed equity securities (Level 1) and unlisted equity investments (Level 3), with the latter valued using a market approach Fair Value of Financial Assets Measured on a Recurring Basis (As of June 30, 2025) | Financial Asset | June 30, 2025 (HK$'000) | December 31, 2024 (HK$'000) | Fair Value Hierarchy | Valuation Technique and Key Inputs | | :--- | :--- | :--- | :--- | :--- | | Listed equity securities classified as FVTPL | 465 | 419 | Level 1 | Quoted prices available from the Stock Exchange | | Unlisted equity investments classified as FVTOCI | 1,174 | 1,174 | Level 3 | Market comparison approach using price-to-sales multiples and risk adjustments for lack of marketability | - During the six months ended June 30, 2025, there were **no transfers between Level 1 and Level 2**, nor any transfers into or out of Level 3[40](index=40&type=chunk) Reconciliation of Level 3 Fair Value Measurements of Financial Assets | Item | Unlisted Equity Investments (HK$'000) | | :--- | :--- | | At January 1, 2024 and June 30, 2024 (unaudited) | 1,370 | | At January 1, 2025 and June 30, 2025 (unaudited) | 1,174 | [Related Party Transactions](index=18&type=section&id=%E9%97%9C%E8%81%AF%E6%96%B9%E4%BA%A4%E6%98%93) For the six months ended June 30, 2025, the total compensation for key management personnel amounted to HK$3,336 thousand, a decrease from the prior-year period Compensation of Key Management Personnel (For the six months ended June 30) | Item | 2025 (HK$'000) | 2024 (HK$'000) | | :--- | :--- | :--- | | Short-term benefits | 3,300 | 3,686 | | Post-employment benefits | 36 | 36 | | **Total** | **3,336** | **3,722** | - Total compensation for key management personnel **decreased by 10.4%** year-on-year[42](index=42&type=chunk) [Management Discussion and Analysis](index=19&type=section&id=%E7%AE%A1%E7%90%86%E5%B1%A4%E8%A8%8E%E8%AB%96%E5%8F%8A%E5%88%86%E6%9E%90) [Business Review and Prospects](index=19&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7%E5%8F%8A%E5%89%8D%E6%99%AF) The Group achieved a turnaround in the first half of 2025 with a net profit of HK$2,326 thousand, driven by strong growth in secondment and payroll services despite a challenging recruitment market - The Group recorded a **net profit of approximately HK$2,326 thousand** in the first half of 2025, a turnaround from a net loss of approximately HK$2,466 thousand in the prior-year period[43](index=43&type=chunk) - Total revenue **increased significantly by 46.5%** to HK$136,290 thousand, primarily driven by the strong performance of payroll and secondment services[44](index=44&type=chunk)[46](index=46&type=chunk) - The strategic focus is on **expanding service offerings** beyond traditional recruitment and investing in a team of experienced recruitment professionals[45](index=45&type=chunk) [Business Review](index=19&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7) As a leading HR service provider in Hong Kong, the Group successfully diversified revenue and returned to profitability by strategically expanding its secondment and payroll services - The Group's total revenue grew significantly due to the **strong performance of payroll and secondment services**, while traditional recruitment services in Hong Kong faced pressure[44](index=44&type=chunk) - The company has strategically focused on **expanding its service scope** to provide comprehensive solutions beyond traditional recruitment to diversify revenue streams[45](index=45&type=chunk) - Revenue from Hong Kong recruitment services increased by 4.9%, secondment and payroll services **surged by 76.5%**, while Singapore recruitment services decreased by 33.9%[46](index=46&type=chunk) [Revenue from Hong Kong Business](index=21&type=section&id=%E4%BE%86%E8%87%AA%E9%A6%99%E6%B8%AF%E6%A5%AD%E5%8B%99%E7%9A%84%E6%94%B6%E7%9B%8A) Economic uncertainty in Hong Kong suppressed recruitment demand, but secondment and payroll services became a key growth driver with revenue surging 76.7% to HK$96,840 thousand - Revenue from Hong Kong secondment and payroll services **increased substantially by HK$42,037 thousand or 76.7%** to HK$96,840 thousand, mainly due to an increase in the number of clients[48](index=48&type=chunk) - Hong Kong recruitment services revenue **grew slightly by 4.9%** to HK$27,646 thousand, amid intense market competition and longer hiring cycles[48](index=48&type=chunk) [Revenue from Mainland China Business](index=22&type=section&id=%E4%BE%86%E8%87%AA%E4%B8%AD%E5%9C%8B%E5%85%A7%E5%9C%B0%E6%A5%AD%E5%8B%99%E7%9A%84%E6%94%B6%E7%9B%8A) The Mainland China business faced a complex operating environment, with recruitment revenue decreasing by 5.2% to HK$8,021 thousand, though the company remains confident in future growth - Recruitment revenue in Mainland China **decreased by HK$436 thousand or 5.2%** to HK$8,021 thousand[49](index=49&type=chunk) - The strategy for Mainland China includes aligning with the Greater Bay Area development plan, increasing business in sectors like technology and consumer goods, and enhancing team quality[50](index=50&type=chunk)[51](index=51&type=chunk) [Revenue from Singapore Business](index=23&type=section&id=%E4%BE%86%E8%87%AA%E6%96%B0%E5%8A%A0%E5%9D%A1%E6%A5%AD%E5%8B%99%E7%9A%84%E6%94%B6%E7%9B%8A) Singapore's recruitment business revenue decreased by 33.9% to HK$1,291 thousand, but the company remains committed to the market as a strategic hub for Southeast Asian expansion - Revenue from the Singapore recruitment business **decreased by HK$663 thousand or 33.9%** to HK$1,291 thousand[53](index=53&type=chunk) - The Singapore business, established in early 2023, continues to show **resilience in a dynamic economic landscape**[53](index=53&type=chunk) [Prospects](index=23&type=section&id=%E5%B1%95%E6%9C%9B) The Group remains optimistic about the long-term growth of the HR industry and will focus on sectors with recovery potential, talent investment, and sustainable growth initiatives - The Group will concentrate resources on industries with **strong recovery potential** and will recruit, train, and retain top recruitment talent[54](index=54&type=chunk) - A focus will be placed on **improving productivity and profitability** through disciplined team composition, geographical focus, and performance monitoring[55](index=55&type=chunk) - The Group will continue to evaluate opportunities for **geographical expansion and service diversification**, while monitoring potential investment opportunities[55](index=55&type=chunk)[57](index=57&type=chunk) [Financial Review](index=25&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) The Group achieved significant revenue growth of 46.5% in H1 2025, driven by secondment services, successfully reversing the prior year's loss despite rising staff costs - The Group's revenue **increased by 46.5%** from HK$93,037 thousand to HK$136,290 thousand, mainly attributable to the growth in secondment and payroll services[58](index=58&type=chunk) - Profit for the period and total comprehensive income turned from a net loss of HK$2,466 thousand to a **net profit of HK$2,326 thousand**[67](index=67&type=chunk) - As of June 30, 2025, the **current ratio was approximately 3.2 times**, and the gearing ratio was 27.4%[69](index=69&type=chunk)[70](index=70&type=chunk) [Revenue](index=25&type=section&id=%E6%94%B6%E7%9B%8A) Total revenue grew 46.5% to HK$136,290 thousand, with secondment and payroll services revenue surging 76.5% while recruitment services revenue saw a marginal 0.5% increase - Recruitment services revenue **increased slightly by 0.5%** to HK$36,958 thousand, with Hong Kong operations growing while Mainland China and Singapore declined[58](index=58&type=chunk) - Secondment and payroll services revenue **increased significantly by 76.5%** to HK$99,332 thousand, driven by team expansion and new strategies in Hong Kong[59](index=59&type=chunk) - Revenue from Hong Kong accounted for approximately **91.3% of the Group's total revenue** (2024: approximately 87.2%)[60](index=60&type=chunk) [Other Income](index=26&type=section&id=%E5%85%B6%E4%BB%96%E6%94%B6%E5%85%A5) Other income increased by HK$250 thousand to HK$873 thousand, primarily from visa application services and seminar and training services - Other income **increased by approximately HK$250 thousand** from HK$623 thousand to HK$873 thousand[61](index=61&type=chunk) - The growth was mainly from **visa application services and seminar and training services**, which increased from HK$338 thousand to HK$621 thousand[61](index=61&type=chunk) [Staff Costs](index=26&type=section&id=%E5%93%A1%E5%B7%A5%E6%88%90%E6%9C%AC) Staff costs rose significantly to HK$121,271 thousand, representing 89.0% of revenue, mainly due to a surge in the number of seconded staff from 671 to 2,650 - Staff costs **increased from HK$80,511 thousand to HK$121,271 thousand**, representing 89.0% of revenue compared to 86.5% previously[62](index=62&type=chunk) - The number of seconded staff **increased substantially from 671** as of June 30, 2024, to 2,650 as of June 30, 2025[62](index=62&type=chunk) - Seconded staff costs **increased by 79.9%** to HK$89,696 thousand, accounting for 74.0% of total staff costs[63](index=63&type=chunk) [Other Expenses and Losses](index=27&type=section&id=%E5%85%B6%E4%BB%96%E9%96%8B%E6%94%AF%E5%8F%8A%E8%99%A7%E6%90%8D) Other expenses and losses decreased by HK$3,144 thousand to HK$12,435 thousand, primarily comprising rent, depreciation, marketing, and insurance expenses - Other expenses and losses **decreased by approximately HK$3,144 thousand** from HK$15,579 thousand to HK$12,435 thousand[64](index=64&type=chunk) [Finance Costs](index=27&type=section&id=%E8%9E%8D%E8%B3%87%E6%88%90%E6%9C%AC) Finance costs increased significantly, mainly due to interest on lease liabilities and newly added interest on bank borrowings - Finance costs **increased from HK$96 thousand to HK$418 thousand**[65](index=65&type=chunk) - The costs comprised **HK$289 thousand in interest on lease liabilities** and HK$114 thousand in interest on bank borrowings[65](index=65&type=chunk) [Income Tax (Expense) Credit](index=27&type=section&id=%E6%89%80%E5%BE%97%E7%A8%85%EF%BC%88%E9%96%8B%E6%94%AF%EF%BC%89%E6%8A%B5%E5%85%8D) Income tax expense increased to HK$969 thousand, primarily due to higher estimated assessable profits from operating subsidiaries - Income tax expense **increased to HK$969 thousand** from HK$377 thousand in the prior-year period (which became a credit of HK$89 thousand after adjustments)[66](index=66&type=chunk) [Profit and Total Comprehensive Income (Expense) for the Period](index=27&type=section&id=%E6%9C%9F%E5%85%A7%E6%BA%A2%E5%88%A9%E5%8F%8A%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%EF%BC%88%E9%96%8B%E6%94%AF%EF%BC%89%E7%B8%BD%E9%A1%8D) The Group successfully turned to profitability, recording a net profit of HK$2,326 thousand and total comprehensive income of HK$2,591 thousand, driven by strong revenue growth - The Group recorded a **net profit of approximately HK$2,326 thousand** and total comprehensive income of approximately HK$2,591 thousand, compared to a net loss of HK$2,466 thousand in the prior-year period[67](index=67&type=chunk) - The turnaround was mainly attributable to the **significant increase in revenue from Hong Kong secondment and payroll services**[67](index=67&type=chunk) [Dividend](index=28&type=section&id=%E8%82%A1%E6%81%AF) The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025 - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025 (six months ended June 30, 2024: **Nil**)[68](index=68&type=chunk) [Liquidity, Financial Resources and Gearing Ratio](index=28&type=section&id=%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E3%80%81%E8%B2%A1%E5%8B%99%E8%B3%87%E6%BA%90%E5%8F%8A%E8%B3%87%E6%9C%AC%E8%B2%A0%E5%82%B5%E6%AF%94%E7%8E%87) The Group maintains sufficient liquidity with HK$2,400 thousand in pledged bank deposits and HK$21,893 thousand in cash, with a current ratio of 3.2 and an increased gearing ratio of 27.4% - As of June 30, 2025, the Group had **pledged bank deposits of HK$2,400 thousand** and bank balances and cash of approximately HK$21,893 thousand[69](index=69&type=chunk) - The **current ratio was approximately 3.2 times** (December 31, 2024: approximately 3.6 times)[69](index=69&type=chunk) - The **gearing ratio was 27.4%** (December 31, 2024: 17.6%), with the increase mainly due to new bank borrowings of HK$8,000 thousand[70](index=70&type=chunk) [Foreign Exchange Risk](index=28&type=section&id=%E5%A4%96%E5%8C%AF%E9%A2%A8%E9%9A%AA) The Group faces no significant foreign exchange risk as most of its revenue-generating operations are denominated in Hong Kong dollars, and no hedging arrangements are in place - The Group's revenue-generating operations are mainly denominated in Hong Kong dollars, thus it has **no significant exposure to foreign exchange rate fluctuations**[71](index=71&type=chunk) - The Group has **not engaged in any hedging** or other arrangements to manage foreign exchange risk[71](index=71&type=chunk) [Other Information](index=29&type=section&id=%E5%85%B6%E4%BB%96%E8%B3%87%E6%96%99) The Group's share structure is stable with no plans for major investments or disposals, while bank deposits of HK$2,400 thousand are pledged and employee numbers have increased - The Company's share capital structure **remained unchanged** during the six months ended June 30, 2025[72](index=72&type=chunk) - The Group **did not hold any significant investments** and had no plans for any major investments or additions of other capital assets[74](index=74&type=chunk) - As of June 30, 2025, the Group had **130 internal staff and 2,650 seconded staff**, with staff costs amounting to approximately HK$121,271 thousand[79](index=79&type=chunk) [Share Structure](index=29&type=section&id=%E8%82%A1%E4%BB%BD%E6%9E%B6%E6%A7%8B) During the six months ended June 30, 2025, the Company's share capital structure remained unchanged, with 800,000,000 ordinary shares in issue - As of June 30, 2025, the total number of issued ordinary shares of the Company was **800,000,000 shares** of HK$0.01 each[72](index=72&type=chunk) [Treasury Policy](index=29&type=section&id=%E8%B2%A1%E8%B3%87%E6%94%BF%E7%AD%96) The Board will continue to follow a prudent policy in managing its cash balances to maintain a strong liquidity position for future growth opportunities - The Directors will continue to follow a **prudent policy** in managing the Group's cash balances and maintain a strong and stable liquidity position[73](index=73&type=chunk) [Significant Investments and Future Plans for Material Investments or Capital Assets](index=29&type=section&id=%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B3%87%E4%BB%A5%E5%8F%8A%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B3%87%E6%88%96%E8%B3%87%E6%9C%AC%E8%B3%87%E7%94%A2%E7%9A%84%E6%9C%AA%E4%BE%86%E8%A8%88%E5%8A%83) As of June 30, 2025, the Group held no significant investments and had no plans for any material investments or additions of other capital assets - The Group **did not hold any significant investments** as of June 30, 2025, nor did it have any plans for material investments or the addition of other capital assets[74](index=74&type=chunk) [Material Acquisitions and Disposals of Subsidiaries, Associates and Joint Ventures](index=29&type=section&id=%E9%99%84%E5%B1%AC%E5%85%AC%E5%8F%B8%E3%80%81%E8%81%AF%E7%87%9F%E5%85%AC%E5%8F%B8%E5%8F%8A%E5%90%88%E7%87%9F%E4%BC%81%E6%A5%AD%E4%B9%8B%E9%87%8D%E5%A4%A7%E6%94%B6%E8%B3%BC%E5%8F%8A%E5%87%BA%E5%94%AE) During the six months ended June 30, 2025, the Group did not have any material acquisitions or disposals of subsidiaries, associates, or joint ventures - During the six months ended June 30, 2025, the Group had **no material acquisitions or disposals** of subsidiaries, associates, or joint ventures[75](index=75&type=chunk) [Pledge of the Group's Assets](index=29&type=section&id=%E6%9C%AC%E9%9B%86%E5%9C%98%E8%B3%87%E7%94%A2%E4%B9%8B%E6%8A%BC%E8%A8%98) As of June 30, 2025, bank deposits of HK$2,400 thousand were pledged as security for the Group's banking facilities - As of June 30, 2025, **bank deposits of HK$2,400 thousand** were pledged as security for the Group's banking facilities[76](index=76&type=chunk) [Contingent Liabilities](index=30&type=section&id=%E6%88%96%E7%84%B6%E8%B2%A0%E5%82%B5) As of June 30, 2025, the Group had no significant contingent liabilities - As of June 30, 2025, the Group had **no significant contingent liabilities**[77](index=77&type=chunk) [Events After the Reporting Period](index=30&type=section&id=%E5%A0%B1%E5%91%8A%E6%9C%9F%E5%BE%8C%E4%BA%8B%E9%A0%85) No significant events occurred for the Company or the Group after June 30, 2025, up to the date of this report - No significant events occurred for the Company and the Group after June 30, 2025, and up to the date of this report[78](index=78&type=chunk) [Employees and Remuneration Policies](index=30&type=section&id=%E5%83%B1%E5%93%A1%E5%8F%8A%E8%96%AA%E9%85%AC%E6%94%BF%E7%AD%96) As of June 30, 2025, the Group had 130 internal staff and 2,650 seconded staff, with a remuneration policy based on performance, qualifications, and industry practice - As of June 30, 2025, the Group had a total of **130 internal staff and 2,650 seconded staff**[79](index=79&type=chunk) - The Group's staff costs, including directors' emoluments, were approximately **HK$121,271 thousand**[79](index=79&type=chunk) - The remuneration policy is based on **performance, qualifications, work experience, and prevailing industry practice**, and includes commissions and discretionary bonuses[79](index=79&type=chunk) [Other Information](index=31&type=section&id=%E5%85%B6%E4%BB%96%E8%B3%87%E8%A8%8A) [Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares and Debentures of the Company or any Associated Corporation](index=31&type=section&id=%E8%91%A3%E4%BA%8B%E5%8F%8A%E6%9C%80%E9%AB%98%E8%A1%8C%E6%94%BF%E4%BA%BA%E5%93%A1%E6%96%BC%E6%9C%AC%E5%85%AC%E5%8F%B8%E6%88%96%E4%BB%BB%E4%BD%95%E7%9B%B8%E8%81%AF%E6%B3%95%E5%9C%98%E4%B9%8B%E8%82%A1%E4%BB%BD%E3%80%81%E7%9B%B8%E9%97%9C%E8%82%A1%E4%BB%BD%E5%8F%8A%E5%82%B5%E5%88%B8%E4%B9%8B%E6%AC%8A%E7%9B%8A%E5%8F%8A%E6%B7%A1%E5%80%89) As of June 30, 2025, Mr Chan Ka Kin, Mr Chan Ka On, and Mr Chan Ka Shing each held a 75% long position in the Company's shares through controlled corporations and a concert party arrangement Directors' Long Positions in the Shares of the Company (As of June 30, 2025) | Name of Director | Capacity/Nature of Interest | Number of Shares Held | Approximate Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | | Mr Chan Ka Kin | Interest in a controlled corporation and person acting in concert | 600,000,000 | 75% | | Mr Chan Ka On | Interest in a controlled corporation and person acting in concert | 600,000,000 | 75% | | Mr Chan Ka Shing | Interest in a controlled corporation and person acting in concert | 600,000,000 | 75% | - Mr Chan Ka Kin, Mr Chan Ka On, Mr Chan Ka Shing, and Mr Chau Ka Wai entered into a **Concert Party Deed** on January 18, 2018[81](index=81&type=chunk) [Substantial Shareholders' Interests and Short Positions in Shares, Debentures and Underlying Shares of the Company](index=33&type=section&id=%E4%B8%BB%E8%A6%81%E8%82%A1%E6%9D%B1%E6%96%BC%E6%9C%AC%E5%85%AC%E5%8F%B8%E8%82%A1%E4%BB%BD%E3%80%81%E5%82%B5%E5%88%B8%E5%8F%8A%E7%9B%B8%E9%97%9C%E8%82%A1%E4%BB%BD%E4%B9%8B%E6%AC%8A%E7%9B%8A%E5%8F%8A%E6%B7%A1%E5%80%89) As of June 30, 2025, KJE Limited, Caiden Holdings Limited, and Mr Chau Ka Wai each held a 75% long position in the Company's shares through beneficial ownership and a concert party arrangement Substantial Shareholders' Long Positions in the Shares of the Company (As of June 30, 2025) | Name of Substantial Shareholder | Capacity/Nature of Interest | Number of Shares Held | Approximate Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | | KJE Limited | Beneficial owner and person acting in concert | 600,000,000 | 75% | | Caiden Holdings Limited | Beneficial owner and person acting in concert | 600,000,000 | 75% | | Mr Chau Ka Wai | Interest in a controlled corporation and person acting in concert | 600,000,000 | 75% | - KJE Limited is owned approximately **33.33% each** by Mr Chan Ka Kin, Mr Chan Ka On, and Mr Chan Ka Shing[82](index=82&type=chunk) - Caiden Holdings Limited is **wholly-owned by Mr Chau Ka Wai**[82](index=82&type=chunk) [Share Option Scheme](index=34&type=section&id=%E8%B3%BC%E8%82%A1%E6%AC%8A%E8%A8%88%E5%8A%83) The Company adopted a share option scheme on September 13, 2018, to reward participants, with no options granted, exercised, cancelled, or lapsed as of June 30, 2025 - The Share Option Scheme was adopted on September 13, 2018, for a period of ten years to **reward or provide incentives to selected participants**[84](index=84&type=chunk) - The maximum number of shares that may be issued upon exercise of all options is **10% of the total number of shares in issue** on the date of approval[85](index=85&type=chunk) - As of June 30, 2025, there were **no outstanding share options**[86](index=86&type=chunk) [Directors' Rights to Acquire Shares or Debentures](index=35&type=section&id=%E8%91%A3%E4%BA%8B%E6%94%B6%E8%B3%BC%E8%82%A1%E4%BB%BD%E6%88%96%E5%82%B5%E5%88%B8%E4%B9%8B%E6%AC%8A%E5%88%A9) During the six months ended June 30, 2025, no arrangements were made to enable directors to acquire benefits by means of the acquisition of shares in or debentures of the Company - During the six months ended June 30, 2025, **no arrangements were entered into** by the Company, its subsidiaries, or other associated corporations to enable Directors to acquire benefits through shares or debentures[87](index=87&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=35&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 had **purchased, sold or redeemed any of the Company's listed securities**[88](index=88&type=chunk) [Competing Interests](index=35&type=section&id=%E7%AB%B6%E7%88%AD%E6%AC%8A%E7%9B%8A) During the six months ended June 30, 2025, no Director or controlling shareholder of the Company had any interest in a business that competes with the Group's business - During the six months ended June 30, 2025, **no Director or controlling shareholder** had any interest in a business that competes or is likely to compete, either directly or indirectly, with the business of the Group[89](index=89&type=chunk) [Corporate Governance Practices](index=36&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%B8%B8%E8%A6%8F) The Company has complied with the code provisions of the Corporate Governance Code as set out in the GEM Listing Rules for the six months ended June 30, 2025 - The Company has **complied with the code provisions** of the Corporate Governance Code as set out in Appendix C1 to the GEM Listing Rules during the six months ended June 30, 2025[90](index=90&type=chunk) [Directors' Securities Transactions](index=36&type=section&id=%E8%91%A3%E4%BA%8B%E4%B9%8B%E8%AD%89%E5%88%B8%E4%BA%A4%E6%98%93) The Company has adopted the required standard of dealings set out in the GEM Listing Rules, and all Directors have confirmed their compliance for the reporting period - The Company has adopted the **required standard of dealings** set out in Rules 5.48 to 5.67 of the GEM Listing Rules as its code of conduct for securities transactions by the Directors[91](index=91&type=chunk) - All Directors have confirmed their **compliance with the required standard of dealings** during the six months ended June 30, 2025[91](index=91&type=chunk) [Audit Committee](index=36&type=section&id=%E5%AF%A9%E6%A0%B8%E5%A7%94%E5%93%A1%E6%9C%83) The Audit Committee, comprising three independent non-executive Directors, is responsible for overseeing financial reporting and internal controls and has reviewed the interim financial statements - The Audit Committee was established on September 13, 2018, and consists of **three independent non-executive Directors**, with Mr Pun Kai Kin as the chairman[92](index=92&type=chunk) - Its primary duties include making recommendations on the appointment of external auditors, reviewing financial statements, and overseeing the internal control and risk management systems[92](index=92&type=chunk) - The Audit Committee has **reviewed the unaudited condensed consolidated financial statements** for the six months ended June 30, 2024[93](index=93&type=chunk) [Board of Directors](index=37&type=section&id=%E8%91%A3%E4%BA%8B%E6%9C%83) As of the date of this report, the Board of Directors comprises four executive Directors and three independent non-executive Directors, with Mr Chan Ka Kin serving as the Chairman - The Board comprises **four executive Directors** (Mr Chan Ka Kin, Mr Chan Ka On, Mr Chan Ka Shing, and Ms Yeung Shek Shek) and **three independent non-executive Directors**[94](index=94&type=chunk) - **Mr Chan Ka Kin** serves as the Chairman of the Board[94](index=94&type=chunk)

[Report Statement and Company Information](index=1&type=section&id=Report%20Statement%20and%20Company%20Information) [Interim Results Announcement](index=1&type=section&id=Interim%20Results%20Announcement) This announcement presents the unaudited interim results of eBroker Systems Limited and its subsidiaries for the six months ended June 30, 2025, complying with GEM Listing Rules and providing company details - The company released its unaudited interim results announcement for the six months ended June 30, 2025, on **August 28, 2025**[3](index=3&type=chunk) - The announcement contains the full 2025 interim report, complying with the GEM Listing Rules of the Stock Exchange[3](index=3&type=chunk) - The Board of Directors includes Executive Directors Mr. Chan Lap Tak (Chairman), Mr. Lo Chi Ho, Ms. Chan Ka Yan, and Independent Non-executive Directors Mr. Chan Chi Kwong, Mr. Liu Kin Sing, and Mr. Au Yeung Po Fung[5](index=5&type=chunk) [Characteristics of GEM](index=3&type=section&id=Characteristics%20of%20GEM) This section outlines the features of the GEM market, highlighting its platform for small and medium-sized companies with higher investment risks and advising investors to prudently assess potential volatility and liquidity risks - The GEM market provides a listing platform for small and medium-sized companies with **higher investment risks** compared to other listed companies on the Stock Exchange[9](index=9&type=chunk) - Investors should understand the potential risks of investing in GEM companies and make investment decisions cautiously[9](index=9&type=chunk) - GEM securities may be subject to **significant market volatility** and high liquidity cannot be guaranteed[9](index=9&type=chunk) [Company Information](index=5&type=section&id=Company%20Information) [Board of Directors and Corporate Structure](index=5&type=section&id=Board%20of%20Directors%20and%20Corporate%20Structure) This section lists the company's Board members, including executive and independent non-executive directors, company secretary, compliance officer, authorized representatives, and the composition of audit, remuneration, and nomination committees - Executive Directors include Chairman Mr. Chan Lap Tak, Chief Executive Officer Mr. Lo Chi Ho, and Ms. Chan Ka Yan[13](index=13&type=chunk) - Independent Non-executive Directors are Mr. Chan Chi Kwong, Mr. Liu Kin Sing, and Mr. Au Yeung Po Fung[13](index=13&type=chunk) - The Audit Committee Chairman is Mr. Au Yeung Po Fung, the Remuneration Committee Chairman is Mr. Liu Kin Sing, and the Nomination Committee Chairman is Mr. Chan Lap Tak[13](index=13&type=chunk) [Key Contact and Registration Information](index=5&type=section&id=Key%20Contact%20and%20Registration%20Information) This section provides key contact and registration details, including the company's auditor, principal bankers, registered office, principal place of business in Hong Kong, legal advisors, share registrar, stock code, and website - The company's auditor is **Kadorie CPA Limited**[13](index=13&type=chunk) - The company's registered office is in the Cayman Islands, with its principal place of business in Hong Kong at Global Financial Centre North Tower, Canton Road, Tsim Sha Tsui, Kowloon[13](index=13&type=chunk) - The company's stock code is **8036**, and its official website is **www.ebrokersystems.com**[14](index=14&type=chunk) [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (Unaudited)](index=7&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income%20%28Unaudited%29) [Performance Overview for the Six Months Ended June 30, 2025](index=7&type=section&id=Performance%20Overview%20for%20the%20Six%20Months%20Ended%20June%2030,%202025) For the six months ended June 30, 2025, the Group achieved a profit of HK$1.107 million, a significant improvement from a loss of HK$1.350 million in the prior period, primarily driven by a substantial increase in net other gains despite a decrease in revenue Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income Key Data | Indicator | Six Months Ended June 30, 2025 (HK$ thousand) | Six Months Ended June 30, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Revenue | 14,125 | 15,904 | | Other income | 253 | 551 | | Net other gains and losses | 2,263 | (373) | | Operating profit/(loss) | 1,206 | (1,269) | | Profit/(loss) before tax | 1,107 | (1,314) | | Profit/(loss) for the period attributable to owners of the Company | 1,107 | (1,350) | | Basic earnings/(loss) per share (HK cents per share) | 0.1 | (0.12) | - Profit for the period attributable to owners of the Company turned from a **loss of HK$1,350 thousand** in the prior period of 2024 to a **profit of HK$1,107 thousand** in the current period of 2025[15](index=15&type=chunk) - Basic earnings per share improved from a **loss of HK$0.12 cents per share** in the prior period of 2024 to **earnings of HK$0.1 cents per share** in the current period of 2025[15](index=15&type=chunk) [Condensed Consolidated Statement of Financial Position (Unaudited)](index=8&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position%20%28Unaudited%29) [Financial Position as at June 30, 2025](index=8&type=section&id=Financial%20Position%20as%20at%20June%2030,%202025) As at June 30, 2025, the Group's net assets increased to HK$61.954 million, with stable net current assets, a slight increase in non-current assets driven by intangible assets, and a significant increase in cash and cash equivalents within current assets Condensed Consolidated Statement of Financial Position Key Data | Indicator | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Non-current assets | 25,795 | 24,925 | | Current assets | 43,730 | 44,039 | | Current liabilities | 6,280 | 6,591 | | Net current assets | 37,450 | 37,448 | | Net assets | 61,954 | 60,380 | | Cash and cash equivalents | 19,965 | 9,645 | | Trade and other receivables | 12,913 | 15,393 | | Financial assets at fair value through profit or loss | 10,389 | 8,154 | - Net assets increased from **HK$60,380 thousand** as at December 31, 2024, to **HK$61,954 thousand** as at June 30, 2025[17](index=17&type=chunk) - Cash and cash equivalents significantly increased from **HK$9,645 thousand** to **HK$19,965 thousand**, while trade and other receivables decreased[17](index=17&type=chunk) [Condensed Consolidated Statement of Changes in Equity (Unaudited)](index=9&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity%20%28Unaudited%29) [Changes in Equity for the Six Months Ended June 30, 2025](index=9&type=section&id=Changes%20in%20Equity%20for%20the%20Six%20Months%20Ended%20June%2030,%202025) For the six months ended June 30, 2025, the Group's total equity increased to HK$61.954 million, driven by a total comprehensive income of HK$1.513 million and shares granted under the share award scheme of HK$61 thousand Condensed Consolidated Statement of Changes in Equity Key Data | Indicator | June 30, 2025 (HK$ thousand) | June 30, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Total equity at beginning of period | 60,380 | 62,568 | | Shares granted under share award scheme | 61 | 59 | | Total comprehensive income/(expense) for the period | 1,513 | (1,371) | | Total equity at end of period | 61,954 | 61,256 | - As at June 30, 2025, total equity was **HK$61,954 thousand**, an increase from **HK$60,380 thousand** as at January 1, 2025[20](index=20&type=chunk) - Total comprehensive income for the period was **HK$1,513 thousand**, compared to a total comprehensive expense of **HK$1,371 thousand** in the prior period, indicating significant performance improvement[20](index=20&type=chunk) [Condensed Consolidated Statement of Cash Flows (Unaudited)](index=10&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows%20%28Unaudited%29) [Cash Flows for the Six Months Ended June 30, 2025](index=10&type=section&id=Cash%20Flows%20for%20the%20Six%20Months%20Ended%20June%2030,%202025) For the six months ended June 30, 2025, the Group's cash and cash equivalents increased by HK$10.165 million, primarily due to positive cash flows from operating and investing activities, with the period-end cash balance reaching HK$19.965 million Condensed Consolidated Statement of Cash Flows Key Data | Indicator | Six Months Ended June 30, 2025 (HK$ thousand) | Six Months Ended June 30, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Net cash generated from/(used in) operating activities | 2,739 | (255) | | Net cash generated from investing activities | 8,312 | 7,551 | | Net cash used in financing activities | (886) | (787) | | Net increase in cash and cash equivalents | 10,165 | 1,897 | | Cash and cash equivalents at end of period | 19,965 | 30,414 | - Net cash generated from operating activities turned from **cash used of HK$255 thousand** in the prior period of 2024 to **cash generated of HK$2,739 thousand** in the current period of 2025[22](index=22&type=chunk) - Net increase in cash and cash equivalents significantly rose from **HK$1,897 thousand** in the prior period of 2024 to **HK$10,165 thousand**[22](index=22&type=chunk) [Notes to the Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) [1. General Information](index=11&type=section&id=1.%20General%20Information) This note outlines eBroker Systems Limited's registration details, including its incorporation date in the Cayman Islands and its listing date on GEM of the Stock Exchange of Hong Kong - eBroker Systems Limited was incorporated in the Cayman Islands on **May 23, 2016**[23](index=23&type=chunk) - The company's shares were listed on GEM of the Stock Exchange of Hong Kong on **February 19, 2019**[23](index=23&type=chunk) [2. Basis of Preparation](index=11&type=section&id=2.%20Basis%20of%20Preparation) This note explains that the unaudited condensed consolidated financial statements are prepared in accordance with HKAS 34 "Interim Financial Reporting," consistent with the accounting policies used in the 2024 audited consolidated financial statements, while also noting the application of accounting estimates and assumptions - The unaudited condensed consolidated financial statements are prepared in accordance with **Hong Kong Accounting Standard 34 "Interim Financial Reporting"** issued by the Hong Kong Institute of Certified Public Accountants[24](index=24&type=chunk) - The significant accounting policies adopted are consistent with those used in the 2024 audited consolidated financial statements, except for new and revised standards[24](index=24&type=chunk) [3. Adoption of New and Revised Hong Kong Financial Reporting Standards](index=11&type=section&id=3.%20Adoption%20of%20New%20and%20Revised%20Hong%20Kong%20Financial%20Reporting%20Standards) This note indicates that the Board expects the adoption of new and revised HKFRSs effective January 1, 2025, will not materially impact current and prior period results and financial position, and the Group is evaluating the potential impact of standards not yet effective - The Directors believe that the adoption of new and revised Hong Kong Financial Reporting Standards will **not have a material impact** on the results and financial position for the current and prior periods[25](index=25&type=chunk) - The Group is evaluating the potential impact of Hong Kong Financial Reporting Standards that are not yet effective or have not been early adopted[25](index=25&type=chunk) [4. Revenue](index=12&type=section&id=4.%20Revenue) This note details the Group's revenue breakdown by major product or service lines and geographical regions, showing a decrease in total revenue from HK$15.904 million in the prior period of 2024 to HK$14.125 million in the current period of 2025, primarily due to reduced income from front-office trading and back-office settlement services, despite growth in the Mainland China market Revenue by Product or Service Line | Product or Service Line | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Front-office trading solution services income | 6,921 | 8,027 | | Back-office settlement solution services income | 3,996 | 4,726 | | Installation and customization services income | 1,989 | 1,323 | | Managed cloud services income | 756 | 1,038 | | Others | 463 | 790 | | Total | 14,125 | 15,904 | Revenue by Major Geographical Market | Major Geographical Market | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Hong Kong | 12,758 | 14,846 | | Macau | 302 | 598 | | Mainland China | 984 | 393 | | Singapore | 81 | 67 | | Total | 14,125 | 15,904 | - Total revenue decreased by **11.2% year-on-year**, primarily due to a decline in front-office trading solution services income and back-office settlement solution services income[27](index=27&type=chunk) [5. Other Income, and Net Other Gains and Losses](index=13&type=section&id=5.%20Other%20Income,%20and%20Net%20Other%20Gains%20and%20Losses) This note discloses the Group's other income and net other gains and losses, with other income decreasing year-on-year due to lower bank interest and dividend income, but significant fair value gains from financial assets at fair value through profit or loss resulted in a shift from net loss to net gain Other Income | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Bank interest income | 232 | 431 | | Dividend income from financial assets at fair value through profit or loss | 16 | 114 | | Government grants | 5 | 6 | | Total | 253 | 551 | Net Other Gains and Losses | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Fair value gains/(losses) on financial assets at fair value through profit or loss – listed equity investments | 2,263 | (373) | - Other income decreased from **HK$551 thousand** in the prior period of 2024 to **HK$253 thousand** in the current period of 2025[28](index=28&type=chunk) - Fair value gains on financial assets at fair value through profit or loss turned from a **loss of HK$373 thousand** in the prior period of 2024 to a **gain of HK$2,263 thousand** in the current period of 2025[28](index=28&type=chunk) [6. Other Operating Expenses](index=13&type=section&id=6.%20Other%20Operating%20Expenses) This note presents the Group's other operating expenses, totaling HK$4.797 million for the six months ended June 30, 2025, a decrease from HK$5.359 million in the prior period of 2024, mainly due to reduced service costs, legal and professional fees, and exchange losses Other Operating Expenses | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Service costs | 872 | 1,025 | | Amortisation of intangible assets | 669 | 669 | | Auditor's remuneration | 343 | 378 | | Legal and professional fees | 973 | 1,080 | | Office expenses | 818 | 729 | | Net exchange gains/(losses) | (205) | 140 | | Total other operating expenses | 4,797 | 5,359 | - Total other operating expenses decreased by **10.5% year-on-year**, from **HK$5,359 thousand** to **HK$4,797 thousand**[29](index=29&type=chunk) - Net exchange gains/(losses) turned from a **loss of HK$140 thousand** in the prior period of 2024 to a **gain of HK$205 thousand** in the current period of 2025[29](index=29&type=chunk) [7. Segment Information](index=14&type=section&id=7.%20Segment%20Information) This note clarifies that the Group has only one reportable segment, providing financial software solution services to clients, with geographical revenue data indicating Hong Kong remains the primary market, but Mainland China's contribution has increased - The Group has one reportable segment, which is the provision of services to customers, primarily involving the sale of computer products, provision of contractual trading solutions, and development of electronic trading systems[30](index=30&type=chunk) Revenue by Geographical Location | Region | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Hong Kong | 12,758 | 14,846 | | Macau | 302 | 598 | | Mainland China | 984 | 393 | | Singapore | 81 | 67 | | Total | 14,125 | 15,904 | - No individual customer contributed more than **10% of total revenue** during the period[30](index=30&type=chunk) [8. Income Tax Expense](index=15&type=section&id=8.%20Income%20Tax%20Expense) This note shows the Group's income tax expense for the six months ended June 30, 2025, was zero, a significant reduction from HK$36 thousand in the prior period, mainly due to tax losses incurred by a PRC subsidiary Income Tax Expense | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Current tax – Hong Kong Profits Tax | – | 36 | - Hong Kong Profits Tax rate is **8.25%** on the first HK$2 million of assessable profits and **16.5%** thereafter[31](index=31&type=chunk) - No provision for corporate income tax was made for the PRC subsidiary during the period due to tax losses incurred[31](index=31&type=chunk) [9. Profit/(Loss) for the Period](index=15&type=section&id=9.%20Profit%2F%28Loss%29%20for%20the%20Period) This note details the various expenses and income affecting the Group's profit/loss for the period, including depreciation, net reversal of impairment loss on trade receivables, and finance costs, with profit primarily benefiting from the net reversal of impairment loss on trade receivables Major Items Affecting Profit/(Loss) for the Period | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | | :--- | :--- | :--- | | Auditor's remuneration | 343 | 378 | | Depreciation of property, plant and equipment | 422 | 420 | | Depreciation of right-of-use assets | 806 | 726 | | Net reversal of impairment loss on trade receivables | (171) | (7) | | Interest expense on lease liabilities | 99 | 45 | - Net reversal of impairment loss on trade receivables was **HK$171 thousand**, positively impacting profit for the period[32](index=32&type=chunk) - Finance costs, primarily interest expense on lease liabilities, increased from **HK$45 thousand** in the prior period of 2024 to **HK$99 thousand** in the current period of 2025[33](index=33&type=chunk) [10. Earnings/(Loss) Per Share](index=16&type=section&id=10.%20Earnings%2F%28Loss%29%20Per%20Share) This note calculates the Group's basic earnings per share for the six months ended June 30, 2025, at HK$0.1 cents, a significant improvement from a loss of HK$0.12 cents per share in the prior period, with no diluted earnings per share calculated due to the absence of potentially dilutive ordinary shares Earnings/(Loss) Per Share Calculation | Indicator | 2025 (HK$ thousand/thousand shares) | 2024 (HK$ thousand/thousand shares) | | :--- | :--- | :--- | | Profit/(loss) attributable to owners of the Company | 1,107 | (1,350) | | Weighted average number of ordinary shares | 1,147,095 | 1,144,860 | | Basic earnings/(loss) per share (HK cents per share) | 0.1 | (0.12) | - Basic earnings per share improved from a **loss of HK$0.12 cents per share** in the prior period of 2024 to **earnings of HK$0.1 cents per share** in the current period of 2025[35](index=35&type=chunk) - Diluted earnings/(loss) per share was not calculated as there were no potentially dilutive ordinary shares[35](index=35&type=chunk) [11. Dividends](index=16&type=section&id=11.%20Dividends) This note states that the Board does not recommend the payment of any dividend for the six months ended June 30, 2025, consistent with the prior period - The Directors do not recommend the payment of any dividend for the six months ended June 30, 2025 (June 30, 2024: nil HK$)[36](index=36&type=chunk) [12. Contract Assets and Contract Liabilities](index=17&type=section&id=12.%20Contract%20Assets%20and%20Contract%20Liabilities) This note details the Group's contract assets and liabilities, with contract assets slightly increasing due to completed but unbilled work, and contract liabilities significantly growing due to increased prepayments from a rise in overall installation projects Contract Assets and Contract Liabilities | Item | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Contract assets related to provision of services | 399 | 375 | | Contract liabilities related to provision of services | 1,747 | 1,216 | - The increase in contract assets is primarily due to an increase in work completed but not yet billed[37](index=37&type=chunk) - The increase in contract liabilities is mainly due to an increase in prepayments resulting from an increase in overall installation projects[38](index=38&type=chunk) [13. Trade and Other Receivables](index=19&type=section&id=13.%20Trade%20and%20Other%20Receivables) This note provides a detailed analysis of trade and other receivables, showing a decrease in the total from HK$16.208 million as at December 31, 2024, to HK$13.728 million as at June 30, 2025, mainly due to a reduction in amounts due from brokers, with trade terms typically offering an average credit period of 60 days Trade and Other Receivables | Item | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Trade receivables (net of impairment loss) | 2,813 | 2,712 | | Prepayments, deposits and other receivables | 1,402 | 1,447 | | Amount due from a trustee | 661 | 662 | | Amounts due from brokers | 8,852 | 11,387 | | Total | 13,728 | 16,208 | - Amounts due from brokers decreased from **HK$11,387 thousand** as at December 31, 2024, to **HK$8,852 thousand** as at June 30, 2025[40](index=40&type=chunk) Ageing Analysis of Trade Receivables | Ageing | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | 0 to 30 days | 1,976 | 1,174 | | 31 to 60 days | 212 | 347 | | 61 to 90 days | 118 | 267 | | 91 to 120 days | 144 | 386 | | Over 120 days | 363 | 538 | | Total | 2,813 | 2,712 | [14. Trade and Other Payables](index=20&type=section&id=14.%20Trade%20and%20Other%20Payables) This note presents the Group's trade and other payables, which slightly increased from HK$2.941 million as at December 31, 2024, to HK$3.084 million as at June 30, 2025, primarily due to an increase in accrued expenses and other payables Trade and Other Payables | Item | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Trade payables | 177 | 214 | | Accrued expenses and other payables | 2,907 | 2,727 | | Total | 3,084 | 2,941 | - Accrued expenses and other payables increased from **HK$2,727 thousand** as at December 31, 2024, to **HK$2,907 thousand** as at June 30, 2025[43](index=43&type=chunk) Ageing Analysis of Trade Payables | Ageing | June 30, 2025 (HK$ thousand) | December 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | 0 to 30 days | 101 | 136 | | 31 to 60 days | 74 | 76 | | 61 to 90 days | – | – | | Over 90 days | 2 | 2 | | Total | 177 | 214 | [15. Share Capital](index=21&type=section&id=15.%20Share%20Capital) This note outlines the Group's capital management objective to ensure continuous operation and maximize shareholder returns, with a stable share capital structure of 1,230,000 thousand issued shares and a total liabilities to total assets ratio of approximately 10.9% as at June 30, 2025 - The Group's capital management objective is to ensure its ability to continue as a going concern and to maximize returns to shareholders through optimizing the debt and equity balance[45](index=45&type=chunk) - As at June 30, 2025, the Group's total liabilities to total assets ratio was approximately **10.9%** (December 31, 2024: approximately 12.44%)[45](index=45&type=chunk) Share Capital Structure | Item | Par Value (HK$) | Number of Shares (thousand shares) | Amount (HK$ thousand) | | :--- | :--- | :--- | :--- | | Authorised ordinary shares | 0.001 | 5,000,000 | 5,000 | | Issued and fully paid ordinary shares | 0.001 | 1,230,000 | 1,230 | [16. Right-of-Use Assets](index=23&type=section&id=16.%20Right-of-Use%20Assets) This note states that for the six months ended June 30, 2025, the Group did not add any new right-of-use assets and recognized approximately HK$806 thousand in depreciation expense for right-of-use assets - For the six months ended June 30, 2025, the Group added approximately **nil HK$** in right-of-use assets (December 31, 2024: HK$947 thousand)[47](index=47&type=chunk) - Depreciation expense of approximately **HK$806 thousand** for right-of-use assets was recognized during the period (December 31, 2024: approximately HK$1,508 thousand)[47](index=47&type=chunk) [17. Property, Plant and Equipment](index=23&type=section&id=17.%20Property,%20Plant%20and%20Equipment) This note discloses that for the six months ended June 30, 2025, the Group purchased approximately HK$40 thousand of property, plant and equipment - For the six months ended June 30, 2025, the Group purchased approximately **HK$40 thousand** of property, plant and equipment (December 31, 2024: approximately HK$53 thousand)[48](index=48&type=chunk) [18. Intangible Assets](index=23&type=section&id=18.%20Intangible%20Assets) This note states that for the six months ended June 30, 2025, the Group capitalized development costs of approximately HK$1.986 million - For the six months ended June 30, 2025, the Group capitalized development costs of approximately **HK$1,986 thousand** (December 31, 2024: approximately HK$3,348 thousand)[49](index=49&type=chunk) [19. Reserves](index=23&type=section&id=19.%20Reserves) This note indicates that the Group's reserve amounts and changes are presented in the condensed consolidated statement of changes in equity - The Group's reserve amounts and corresponding changes for the current period and the prior period of 2024 are presented in the unaudited condensed consolidated statement of changes in equity in this report[50](index=50&type=chunk) [20. Contingent Liabilities](index=23&type=section&id=20.%20Contingent%20Liabilities) This note declares that as at June 30, 2025, the Group had no significant contingent liabilities - As at June 30, 2025, the Group had **no significant contingent liabilities**[50](index=50&type=chunk) [21. Events After the Reporting Period](index=23&type=section&id=21.%20Events%20After%20the%20Reporting%20Period) This note states that no significant events occurred after June 30, 2025, up to the date of this report - No significant events occurred after June 30, 2025, and up to the date of this report[51](index=51&type=chunk) [22. Approval of Financial Statements](index=23&type=section&id=22.%20Approval%20of%20Financial%20Statements) This note confirms that the condensed consolidated financial statements for the six months ended June 30, 2025, were approved and authorized for issue by the Board of Directors on August 28, 2025 - The condensed consolidated financial statements for the six months ended June 30, 2025, were approved and authorized for issue by the Board of Directors on **August 28, 2025**[52](index=52&type=chunk) [Management Discussion and Analysis](index=24&type=section&id=Management%20Discussion%20and%20Analysis) [Business Review](index=24&type=section&id=Business%20Review) The Group primarily provides financial software solutions to Hong Kong financial institutions, with revenue of approximately HK$14.1 million for the six months ended June 30, 2025, a year-on-year decrease of 11.2%; however, profit attributable to owners of the Company significantly increased by 182% to approximately HK$1.1 million from a loss of HK$1.4 million in the prior period, mainly due to increased non-recurring installation and customization services and other income growth - The Group primarily provides financial software solution services to Hong Kong financial institutions, including front-office trading, back-office settlement, installation and customization, and managed cloud services[53](index=53&type=chunk) Business Review Key Financial Data | Indicator | Six Months Ended June 30, 2025 (HK$ million) | Six Months Ended June 30, 2024 (HK$ million) | | :--- | :--- | :--- | | Revenue | 14.1 | 15.9 | | Profit/(loss) attributable to owners of the Company | 1.1 | (1.4) | - The **182% increase in profit** is mainly attributable to an increase of approximately **HK$0.7 million** in non-recurring installation and customization services and an increase of **HK$2.6 million** in other income, coupled with a reduction of approximately **HK$1.4 million** in staff costs[53](index=53&type=chunk) [Outlook](index=24&type=section&id=Outlook) Looking ahead, the Group anticipates continued macroeconomic uncertainties but will proactively address challenges and capitalize on opportunities from technological advancements and innovation to achieve sustainable business growth and long-term shareholder value - The macroeconomic environment will continue to face uncertainties arising from ongoing geopolitical developments and rapid technological innovation[54](index=54&type=chunk) - The Group will continue to address challenges while seizing opportunities presented by technological advancements and innovation to achieve sustainable business growth and long-term shareholder interests[54](index=54&type=chunk) [Financial Review](index=25&type=section&id=Financial%20Review) This section provides a detailed review of the Group's financial performance for the six months ended June 30, 2025, including changes in revenue, costs, and expenses, explaining the key drivers behind the shift from loss to profit [Revenue](index=25&type=section&id=Revenue) The Group's total revenue decreased by 11.2% year-on-year to HK$14.1 million, primarily due to a decline in income from front-office trading solution services and back-office settlement solution services - Total revenue was approximately **HK$14.1 million**, a decrease of approximately **11.2%** compared to HK$15.9 million in the prior period[56](index=56&type=chunk) Major Service Line Revenue Changes | Service Line | 2025 (HK$ million) | 2024 (HK$ million) | Change (%) | | :--- | :--- | :--- | :--- | | Back-office settlement solution services income | 4.0 | 4.7 | -15.4% | | Front-office trading solution services income | 6.9 | 8.0 | -13.8% | [Purchases and Changes in Inventories](index=25&type=section&id=Purchases%20and%20Changes%20in%20Inventories) For the six months ended June 30, 2025, the Group's purchases and changes in inventories were nil, a 100% decrease from the prior period, primarily because no products were sold during the period - Purchases and changes in inventories for the six months ended June 30, 2025, were **nil HK$**, a decrease of approximately **100%** compared to approximately HK$4 thousand in the prior period[57](index=57&type=chunk) - This decrease was primarily due to the Group having **no product sales** for the six months ended June 30, 2025[57](index=57&type=chunk) [Profit Before Tax](index=26&type=section&id=Profit%20Before%20Tax) The Group's profit before tax was approximately HK$1.1 million, a significant increase of 184.2% from a loss before tax of HK$1.3 million in the prior period, mainly driven by an increase of HK$2.6 million in other income Profit Before Tax Changes | Indicator | 2025 (HK$ million) | 2024 (HK$ million) | Change (%) | | :--- | :--- | :--- | :--- | | Profit/(loss) before tax | 1.1 | (1.3) | +184.2% | - This increase is mainly due to an increase of approximately **HK$2.6 million** in other income for the six months ended June 30, 2025[58](index=58&type=chunk) [Other Income](index=26&type=section&id=Other%20Income) The Group's other income decreased to HK$253 thousand, primarily due to a decline in bank interest income and dividend income Other Income Changes | Item | 2025 (HK$ thousand) | 2024 (HK$ thousand) | Change (HK$ thousand) | | :--- | :--- | :--- | :--- | | Total other income | 253 | 551 | -298 | | Decrease in interest income | - | - | -199 | | Decrease in dividend income | - | - | -98 | - The decrease in other income is mainly due to a reduction of approximately **HK$199 thousand** in interest income and approximately **HK$98 thousand** in dividend income[59](index=59&type=chunk) [Staff Costs](index=26&type=section&id=Staff%20Costs) For the six months ended June 30, 2025, the Group's staff costs decreased by approximately HK$1.4 million to HK$9.4 million Staff Costs Changes | Indicator | 2025 (HK$ million) | 2024 (HK$ million) | Change (HK$ million) | | :--- | :--- | :--- | :--- | | Staff costs | 9.4 | 10.8 | -1.4 | [Depreciation](index=26&type=section&id=Depreciation) The Group's depreciation expense increased by approximately HK$82 thousand, a year-on-year growth of 7.2% to HK$1.2 million Depreciation Expense Changes | Indicator | 2025 (HK$ million) | 2024 (HK$ million) | Change (%) | | :--- | :--- | :--- | :--- | | Depreciation expense | 1.2 | 1.1 | +7.2% | [Other Operating Expenses](index=26&type=section&id=Other%20Operating%20Expenses) The Group's other operating expenses decreased by approximately 10.5% to HK$4.8 million, primarily due to reductions in legal and professional fees, service costs, and exchange losses Other Operating Expenses Changes | Indicator | 2025 (HK$ million) | 2024 (HK$ million) | Change (%) | | :--- | :--- | :--- | :--- | | Total other operating expenses | 4.8 | 5.4 | -10.5% | - The decrease is mainly attributable to a reduction of approximately **HK$0.1 million** in legal and professional fees, approximately **HK$0.2 million** in service costs, and approximately **HK$0.3 million** in exchange losses[62](index=62&type=chunk) [Income Tax Expense](index=26&type=section&id=Income%20Tax%20Expense) The Group's income tax expense was nil, a 100% decrease from the prior period, primarily due to a reduction in profit before tax during the period Income Tax Expense Changes | Indicator | 2025 (HK$ thousand) | 2024 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Income tax expense | 0 | 36 | -100% | - This decrease is due to a reduction in profit before tax for the six months ended June 30, 2025[63](index=63&type=chunk) [Profit for the Period Attributable to Owners of the Company](index=27&type=section&id=Profit%20for%20the%20Period%20Attributable%20to%20Owners%20of%20the%20Company) Profit for the period attributable to owners of the Company was approximately HK$1.1 million, a significant increase of 182.0% from a loss of HK$1.4 million in the prior period, primarily due to an increase of approximately HK$2.6 million in other income Profit for the Period Attributable to Owners of the Company Changes | Indicator | 2025 (HK$ million) | 2024 (HK$ million) | Change (%) | | :--- | :--- | :--- | :--- | | Profit/(loss) for the period attributable to owners of the Company | 1.1 | (1.4) | +182.0% | - The increase is mainly attributable to an increase of approximately **HK$2.6 million** in other income for the six months ended June 30, 2025[65](index=65&type=chunk) [Liquidity and Financial Resources](index=27&type=section&id=Liquidity%20and%20Financial%20Resources) The Group's operations are primarily funded by cash generated from operations; as at June 30, 2025, net current assets were approximately HK$37.5 million, total current assets were approximately HK$43.7 million, with cash and cash equivalents significantly increasing to HK$20.0 million, and the Group had no interest-bearing borrowings - The Group's operations are primarily funded by cash generated from operating activities[66](index=66&type=chunk) Liquidity Overview | Indicator | June 30, 2025 (HK$ million) | December 31, 2024 (HK$ million) | | :--- | :--- | :--- | | Net current assets | 37.5 | 37.4 | | Total current assets | 43.7 | 44.0 | | Cash and cash equivalents | 20.0 | 9.6 | | Financial assets at fair value through profit or loss | 10.4 | 8.2 | | Trade and other receivables | 12.9 | 15.4 | - As at June 30, 2025, the Group had **no interest-bearing or non-interest-bearing borrowings**, rendering the gearing ratio inapplicable for analysis[66](index=66&type=chunk) [Key Risks and Uncertainties](index=27&type=section&id=Key%20Risks%20and%20Uncertainties) The Group faces key risks including R&D failing to keep pace with technological advancements, trade receivables recovery risk leading to impairment losses, and financial risks such as credit risk, liquidity risk, and interest rate risk - Key risks include the possibility that R&D may not keep pace with technological advancements crucial for the Group's competitiveness[67](index=67&type=chunk) - The Group may be unable to recover its trade receivables in a timely manner and may be required to record impairment losses[67](index=67&type=chunk) - The business faces various financial risks, including credit risk, liquidity risk, and interest rate risk[67](index=67&type=chunk) [Capital Structure](index=28&type=section&id=Capital%20Structure) Since its listing on GEM of the Stock Exchange on February 19, 2019, the company's capital structure has remained unchanged, primarily comprising issued share capital and reserves - The shares were listed on GEM of the Stock Exchange on **February 19, 2019**, and the capital structure has remained unchanged since then[68](index=68&type=chunk) - As at June 30, 2025, the company's capital structure primarily comprised issued share capital and reserves[68](index=68&type=chunk) [Purchase, Sale or Redemption of Securities by the Company and its Subsidiaries](index=28&type=section&id=Purchase,%20Sale%20or%20Redemption%20of%20Securities%20by%20the%20Company%20and%20its%20Subsidiaries) 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 securities, convertible securities, share options, warrants, or similar rights - 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 securities[69](index=69&type=chunk) [Issue of Securities or Sale of Treasury Shares](index=28&type=section&id=Issue%20of%20Securities%20or%20Sale%20of%20Treasury%20Shares) For the six months ended June 30, 2025, neither the company nor any of its subsidiaries issued any equity securities, convertible securities, share options, warrants, or similar rights, nor did they sell any treasury shares for cash - For the six months ended June 30, 2025, neither the company nor any of its subsidiaries issued any equity securities, convertible securities, share options, warrants, or similar rights[70](index=70&type=chunk) - No treasury shares were sold for cash during the period[70](index=70&type=chunk) [Pledged Assets](index=28&type=section&id=Pledged%20Assets) As at June 30, 2025, the Group had no pledged assets - As at June 30, 2025, the Group had **no pledged assets** (December 31, 2024: nil HK$)[71](index=71&type=chunk) [Material Acquisitions and Disposals](index=28&type=section&id=Material%20Acquisitions%20and%20Disposals) For the six months ended June 30, 2025, the Group did not undertake any material investments in subsidiaries or any material acquisitions and disposals - For the six months ended June 30, 2025, the Group did not undertake any material investments in subsidiaries or any material acquisitions and disposals[72](index=72&type=chunk) [Capital Commitments and Contingent Liabilities](index=28&type=section&id=Capital%20Commitments%20and%20Contingent%20Liabilities) As at June 30, 2025, the Group had no significant capital commitments or contingent liabilities - As at June 30, 2025, the Group had **no significant capital commitments or contingent liabilities**[73](index=73&type=chunk) [Exchange Rate Fluctuation Risk](index=28&type=section&id=Exchange%20Rate%20Fluctuation%20Risk) The Group's revenue and costs are primarily denominated in Hong Kong Dollars, with some costs in Renminbi; currently, there is no foreign currency hedging policy, but the Board continuously monitors foreign exchange risk and will consider hedging when necessary - The Group's revenue and costs are primarily denominated in **Hong Kong Dollars**, with some costs denominated in **Renminbi**[74](index=74&type=chunk) - The Group currently has **no foreign currency hedging policy**, but the Directors continuously monitor relevant foreign exchange risks and will consider hedging when necessary[74](index=74&type=chunk) [Credit Risk](index=29&type=section&id=Credit%20Risk) The Group's credit risk primarily arises from cash and cash equivalents, as well as receivables and contract assets from customer contracts; with bank balances held in recognized banks and a comprehensive credit policy, management expects no significant credit risk - The Group's credit risk primarily arises from cash and cash equivalents, and receivables and contract assets from contracts with customers[76](index=76&type=chunk) - All bank balances are deposited with recognized banks in Hong Kong, and with a comprehensive credit policy, management expects **no significant credit risk**[76](index=76&type=chunk) [Liquidity Risk](index=29&type=section&id=Liquidity%20Risk) The Group's policy is to continuously monitor funding and anticipated liquidity requirements to ensure sufficient cash reserves to meet both short-term and long-term liquidity needs - The Group's policy is to constantly monitor funding and anticipated liquidity requirements to ensure sufficient cash reserves to meet the Group's short-term and long-term liquidity needs[77](index=77&type=chunk) [Interest Rate Risk](index=29&type=section&id=Interest%20Rate%20Risk) The Group's interest rate risk stems from its bank deposits, which bear floating interest rates; however, with no other interest-bearing assets and liabilities, the Group has no significant interest rate risk - The Group's interest rate risk arises from its bank deposits, which bear floating interest rates[78](index=78&type=chunk) - The Group has **no significant interest rate risk**, and its income and operating cash flows are largely unaffected by changes in floating interest rates[78](index=78&type=chunk) [Human Resources and Remuneration Policy](index=29&type=section&id=Human%20Resources%20and%20Remuneration%20Policy) As at June 30, 2025, the Group had 51 full-time employees; remuneration policy is determined based on qualifications, function, experience, performance, and market conditions, and is regularly reviewed; the Group provides training and has a share option scheme and share award scheme to incentivize employees - As at June 30, 2025, the Group had **51 full-time employees** (2024: 55 employees)[79](index=79&type=chunk) - Employee remuneration is determined based on qualifications, function, experience, work performance, and local market conditions, and is reviewed regularly[79](index=79&type=chunk) - The company has a **share option scheme** (adopted on January 22, 2019) and a **share award scheme** (adopted on August 12, 2019) to recognize and reward employee contributions[79](index=79&type=chunk) [Changes in Board Members](index=29&type=section&id=Changes%20in%20Board%20Members) Ms. Chan Ka Yan was appointed as an Executive Director of the company effective May 13, 2024 - Ms. Chan Ka Yan was appointed as an Executive Director of the company effective **May 13, 2024**[80](index=80&type=chunk) [Material Investments and Plans for Material Investments or Capital Assets](index=30&type=section&id=Material%20Investments%20and%20Plans%20for%20Material%20Investments%20or%20Capital%20Assets) Except as disclosed in this report, the Group has no material investments or any other future plans for material investments or capital assets - Except as disclosed herein, the Group has **no material investments** and no other future plans for material investments or capital assets[81](index=81&type=chunk) [Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares and Debentures](index=30&type=section&id=Directors'%20and%20Chief%20Executive's%20Interests%20and%20Short%20Positions%20in%20Shares,%20Underlying%20Shares%20and%20Debentures) As at June 30, 2025, the company's Directors and Chief Executive held long positions in the company's shares, with Mr. Chan Lap Tak holding 0.19% through spouse's interest, Ms. Chan Ka Yan beneficially holding 0.18%, and Mr. Lo Chi Ho beneficially holding 0.99% Directors' and Chief Executive's Long Positions | Director Name | Capacity and Nature of Interest | Number of Shares Held | Approximate Percentage of Issued Shares | | :--- | :--- | :--- | :--- | | Mr. Chan Lap Tak | Interest of spouse | 2,291,420 | 0.19% | | Ms. Chan Ka Yan | Beneficial interest | 2,240,000 | 0.18% | | Mr. Lo Chi Ho | Beneficial interest | 12,210,010 | 0.99% | - Mr. Lo Chi Ho's interests include **10,810,010 shares** and vested award shares of **1,190,000 shares** and **210,000 shares**[83](index=83&type=chunk) [Substantial Shareholders' Interests and Short Positions in Shares, Underlying Shares and Debentures](index=31&type=section&id=Substantial%20Shareholders'%20Interests%20and%20Short%20Positions%20in%20Shares,%20Underlying%20Shares%20and%20Debentures) As at June 30, 2025, substantial shareholders, including Quantsmile (BVI) Limited, Eagle Enterprise Consultants Limited, Good Steward Foundation, Financial Data Technologies Limited, and Bank of Communications Trustee Limited, held interests in the company's shares ranging from 6.74% to 58.10%, with Eagle Enterprise Consultants Limited being the largest shareholder Substantial Shareholders' Long Positions | Name | Capacity and Nature of Interest | Number of Shares Held | Approximate Percentage of Issued Shares | | :--- | :--- | :--- | :--- | | Quantsmile (BVI) Limited | Beneficial interest | 411,902,870 | 33.49% | | Eagle Enterprise Consultants Limited | Beneficial interest/Interest in controlled corporation | 714,676,910 | 58.10% | | Good Steward Foundation | Interest in controlled corporation | 714,676,910 | 58.10% | | Financial Data Technologies Limited | Beneficial interest | 98,040,000 | 7.97% | | Bank of Communications Trustee Limited | Trustee | 82,905,000 | 6.74% | - Eagle Enterprise Consultants Limited is deemed to have an interest in the company's shares held by Quantsmile (BVI) by virtue of holding approximately **50.85%** interest in Quantsmile (BVI)[85](index=85&type=chunk) - Bank of Communications Trustee Limited is the trustee appointed by the company for the Share Award Scheme[87](index=87&type=chunk) [Share Option Scheme](index=32&type=section&id=Share%20Option%20Scheme) The company adopted a share option scheme on January 22, 2019, but no share options have been granted, exercised, cancelled, or lapsed since its adoption date; as at June 30, 2025, the maximum number of share options available for grant under the scheme was 80,100,000 - The company adopted a share option scheme on **January 22, 2019**, but no share options have been granted since the adoption date[88](index=88&type=chunk) - As at June 30, 2025, the maximum number of share options available for grant under the share option scheme was **80,100,000**[88](index=88&type=chunk) [Share Award Scheme](index=32&type=section&id=Share%20Award%20Scheme) The company adopted a share award scheme on August 12, 2019, to reward eligible employees; for the six months ended June 30, 2025, the trustee did not purchase any shares but held 82,905,000 shares; during the period, 5,040,000 award shares were granted to 13 selected individuals, of which 2,520,000 shares will vest on December 31, 2025 - The company adopted a share award scheme on **August 12, 2019**, aiming to hold shares through a trustee and vest them to participants[89](index=89&type=chunk) - For the six months ended June 30, 2025, the trustee did not purchase any shares on the Stock Exchange but held **82,905,000 shares**[89](index=89&type=chunk) - On May 13, 2024, the Board resolved to grant a total of **5,040,000 award shares** to 13 selected individuals, of which **2,520,000 shares** will vest on December 31, 2025[91](index=91&type=chunk) [Competing Interests and Non-Competition Undertaking](index=34&type=section&id=Competing%20Interests%20and%20Non-Competition%20Undertaking) Each controlling shareholder entered into a non-competition undertaking on January 22, 2019; for the six months ended June 30, 2025, and up to the date of this report, no Director, controlling shareholder, or their close associates held any interest in businesses competing with the Group's operations - Each controlling shareholder entered into a non-competition undertaking with the company as beneficiary on **January 22, 2019**[92](index=92&type=chunk) - For the six months ended June 30, 2025, and up to the date of this report, no Director, controlling shareholder, or their close associates held any interest in any business that directly or indirectly competes with the Group's business[92](index=92&type=chunk) [Corporate Governance Practices](index=34&type=section&id=Corporate%20Governance%20Practices) The company is committed to achieving high standards of corporate governance and has adopted and complied with the principles and code provisions of the Corporate Governance Code set out in Appendix C1 of the GEM Listing Rules - The company is committed to achieving high standards of corporate governance to protect shareholders' interests, enhance corporate value, formulate business strategies, and improve transparency[93](index=93&type=chunk) - For the six months ended June 30, 2025, the company adopted and complied with the principles and code provisions of the Corporate Governance Code set out in Appendix C1 of the GEM Listing Rules[93](index=93&type=chunk) [Directors' Securities Transactions](index=34&type=section&id=Directors'%20Securities%20Transactions) The company has adopted the required standard of dealings set out in Rules 5.48 to 5.67 of the GEM Listing Rules as the code of conduct for Directors' securities transactions; upon inquiry, all Directors confirmed compliance with this standard - The company has adopted the required standard of dealings set out in **Rules 5.48 to 5.67 of the GEM Listing Rules** as the code of conduct for Directors' securities transactions[94](index=94&type=chunk) - Following specific inquiries with all Directors, all Directors confirmed their compliance with the required standard of dealings for the six months ended June 30, 2025, with no reportable breaches[94](index=94&type=chunk) [Events After Reporting Period](index=35&type=section&id=Events%20After%20Reporting%20Period) No significant events occurred after June 30, 2025, up to the date of this report, for the company or the Group - No significant events occurred after June 30, 2025, and up to the date of this report, for the company or the Group[96](index=96&type=chunk) [Audit Committee](index=35&type=section&id=Audit%20Committee) The company's Audit Committee has reviewed this report and the Group's unaudited condensed consolidated financial results for the six months ended June 30, 2025, confirming their compliance with applicable accounting standards, GEM Listing Rules, and other legal requirements - The company's Audit Committee has reviewed this report and the Group's unaudited condensed consolidated financial results for the six months ended June 30, 2025[97](index=97&type=chunk) - The Audit Committee believes that these results were prepared in compliance with applicable accounting standards, the GEM Listing Rules, and other applicable legal requirements, and that adequate disclosures have been made in this regard[97](index=97&type=chunk) [Dividends](index=35&type=section&id=Dividends) The Directors do not recommend the payment of any dividend for the six months ended June 30, 2025, consistent with the prior period - The Directors do not recommend the payment of any dividend for the six months ended June 30, 2025 (2024: nil HK$)[98](index=98&type=chunk) [Definitions](index=36&type=section&id=Definitions) [Definitions of Terms in the Report](index=36&type=section&id=Definitions%20of%20Terms%20in%20the%20Report) This section provides definitions for key terms used throughout this report, ensuring readers have a clear understanding of the content - This section defines key terms used in the report, such as "Board," "China," "Company," "Controlling Shareholder," "Directors," "GEM Listing Rules," "Group," "HK$," "Hong Kong," "Listing," "Prospectus," "SFO," "Shares," "Shareholder," "Share Award Scheme," "Share Option Scheme," "Stock Exchange," and "%"[99](index=99&type=chunk)[101](index=101&type=chunk)

香港交易及結算所有限公司及香港聯合交易所有限公司對本公佈的內容概不負責， 對其準確性或完整性亦不發表任何聲明，並明確表示，概不對因本公佈全部或任何 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。 （於香港註冊成立的有限公司） （股份代號：154） 截至二零二五年六月三十日止六個月 簡明中期業績公佈 摘要 1 • 截至二零二五年六月三十日止六個月，本集團持續經營業務之收入為人民幣 72,236萬元，較去年同期之人民幣80,323萬元減少約10.1%。 • 本集團期內息稅折舊攤銷前溢利為人民幣34,789萬元，較去年同期之人民幣 32,846萬元增加約5.9%。 • 本公司股東應佔期內溢利為人民幣12,713萬元，較去年同期之人民幣13,345萬 元減少約4.7%。 • 每股基本及攤薄盈利為人民幣8.47分。 • 於二零二五年六月三十日，本公司股東應佔每股淨資產為人民幣2.54元。 • 董事會不建議派發期內中期股息。 北京控股環境集團有限公司（「本公司」）董事（「董事」）會（「董事會」）欣然公佈本公司 及其附屬公司（統稱「本集團」）截至二零二五年六月三十日止六個月之未經審核中期 簡明綜合業績連同去年 ...

[Financial Highlights](index=1&type=section&id=Financial%20Highlights) Key Financial Metrics | Metric | For the six months ended June 30, 2025 (HKD in thousands / %) | For the six months ended June 30, 2024 (HKD in thousands / %) | Change (HKD in thousands / percentage points) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenue | 327,300 | 301,900 | +25,400 | +8.4% | | Gross Profit | 80,800 | 100,700 | -19,900 | -19.8% | | Gross Profit Margin | 24.7% | 33.3% | -8.6 percentage points | - | | Profit attributable to equity holders of the Company | 30,100 | 48,500 | -18,400 | -38.0% | | Net Profit Margin | 9.2% | 16.1% | -6.9 percentage points | - | | Basic earnings per share | 8.38 HK cents | 13.52 HK cents | -5.14 HK cents | -38.0% | | Interim dividend (per ordinary share) | 7.0 HK cents | - | - | - | [Interim Condensed Consolidated Financial Statements](index=2&type=section&id=Interim%20Condensed%20Consolidated%20Financial%20Statements) [Interim Condensed Consolidated Statement of Profit or Loss](index=2&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss) The Group's revenue grew 8.4% year-over-year, but gross profit and profit for the period declined by 19.8% and 38.0% respectively due to higher costs Statement of Profit or Loss | Metric | For the six months ended June 30, 2025 (HKD in thousands) | For the six months ended June 30, 2024 (HKD in thousands) | | :--- | :--- | :--- | | Revenue | 327,295 | 301,933 | | Cost of sales | (246,514) | (201,268) | | Gross Profit | 80,781 | 100,665 | | Other income and gains, net | 6,612 | 9,183 | | Selling and distribution expenses | (7,058) | (7,231) | | General and administrative expenses | (44,243) | (44,770) | | Other expenses, net | 896 | 176 | | Finance costs | (1,696) | (998) | | Profit before tax | 35,292 | 57,025 | | Income tax expense | (5,223) | (8,492) | | Profit for the period | 30,069 | 48,533 | | Basic earnings per share | 8.38 HK cents | 13.52 HK cents | [Interim Condensed Consolidated Statement of Comprehensive Income](index=3&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) Total comprehensive income for the period decreased by 30.3% year-over-year, primarily driven by lower profit, partially offset by a gain on currency translation Statement of Comprehensive Income | Metric | For the six months ended June 30, 2025 (HKD in thousands) | For the six months ended June 30, 2024 (HKD in thousands) | | :--- | :--- | :--- | | Profit for the period | 30,069 | 48,533 | | Exchange differences on translation of foreign operations | 2,811 | (1,365) | | Total comprehensive income for the period | 32,880 | 47,168 | [Interim Condensed Consolidated Statement of Financial Position](index=4&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group's net current assets and net assets decreased due to a significant rise in current liabilities despite higher current assets Statement of Financial Position | Metric | June 30, 2025 (HKD in thousands) | December 31, 2024 (HKD in thousands) | | :--- | :--- | :--- | | Total non-current assets | 209,242 | 218,267 | | Total current assets | 348,324 | 336,189 | | Total current liabilities | 200,018 | 165,612 | | Net current assets | 148,306 | 170,577 | | Total assets less current liabilities | 357,548 | 388,844 | | Total non-current liabilities | 27,425 | 33,802 | | Net assets | 330,123 | 355,042 | | Total equity | 330,123 | 355,042 | [Notes to the Financial Statements](index=6&type=section&id=Notes%20to%20the%20Financial%20Statements) [Company Information](index=6&type=section&id=Company%20Information) The Company, incorporated in the Cayman Islands, primarily manufactures and sells electric home appliances, with Modern Expression Limited as its ultimate holding company - The Company is principally engaged in the **manufacturing and sale of electric home appliances**[12](index=12&type=chunk) - The Company's ultimate holding company is **Modern Expression Limited**[12](index=12&type=chunk) [Basis of Preparation and Changes in Accounting Policies](index=6&type=section&id=Basis%20of%20Preparation%20and%20Changes%20in%20Accounting%20Policies) The interim financial information is prepared under HKAS 34 and aligns with annual accounting policies, with no material impact from newly adopted amendments - The interim condensed consolidated financial information has been prepared in accordance with Hong Kong Accounting Standard (HKAS) 34 "Interim Financial Reporting" issued by the HKICPA[13](index=13&type=chunk) - The new adoption of amendments to HKAS 21 "Lack of Exchangeability" has **no impact** on the interim condensed consolidated financial information[15](index=15&type=chunk) [Operating Segment and Geographical Information](index=7&type=section&id=Operating%20Segment%20and%20Geographical%20Information) The Group's revenue from Europe declined while Asia grew significantly, and its non-current assets are primarily located in Hong Kong and Mainland China [Revenue from External Customers](index=7&type=section&id=Revenue%20from%20External%20Customers) The Group's total revenue from external customers increased by 8.4%, driven by a substantial 149.7% growth in the Asian market that offset a decline in Europe Revenue by Region | Region | For the six months ended June 30, 2025 (HKD in thousands) | For the six months ended June 30, 2024 (HKD in thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Europe | 259,930 | 270,240 | -3.8% | | Asia | 59,922 | 24,002 | +149.7% | | USA | 2,053 | 3,347 | -38.6% | | Others | 5,390 | 4,344 | +24.1% | | Total Revenue | 327,295 | 301,933 | +8.4% | [Non-current Assets](index=7&type=section&id=Non-current%20Assets) The Group's total non-current assets decreased slightly, with a higher concentration in Mainland China compared to Hong Kong Non-current Assets by Region | Region | June 30, 2025 (HKD in thousands) | December 31, 2024 (HKD in thousands) | | :--- | :--- | :--- | | Hong Kong | 97,457 | 100,243 | | Mainland China | 108,867 | 114,687 | | Total Non-current Assets | 206,324 | 214,930 | [Major Customers Information](index=8&type=section&id=Major%20Customers%20Information) Revenue contribution from major customers shifted, with significant growth from Customer C offsetting declines from Customers A and B Revenue from Major Customers | Customer | For the six months ended June 30, 2025 (HKD in thousands) | For the six months ended June 30, 2024 (HKD in thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Customer C | 81,409 | 64,691 | +25.8% | | Customer A | 72,096 | 84,257 | -14.4% | | Customer B | 36,425 | 42,986 | -15.3% | [Analysis of Revenue, Other Income and Gains, Net](index=8&type=section&id=Analysis%20of%20Revenue%2C%20Other%20Income%20and%20Gains%2C%20Net) The Group's revenue from customer contracts grew 8.4%, while other income and gains fell 28.0% due to lower bank interest and foreign exchange gains Revenue and Other Income Analysis | Metric | For the six months ended June 30, 2025 (HKD in thousands) | For the six months ended June 30, 2024 (HKD in thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue (from contracts with customers) | 327,295 | 301,933 | +8.4% | | Total other income and gains, net | 6,612 | 9,183 | -28.0% | | - Bank interest income | 1,451 | 3,381 | -57.0% | | - Consultation income | 1,664 | 1,891 | -12.0% | | - Net foreign exchange differences | 2,686 | 3,475 | -22.7% | [Items Deducted/Credited in Arriving at Profit Before Tax](index=9&type=section&id=Items%20Deducted%2FCredited%20in%20Arriving%20at%20Profit%20Before%20Tax) Profit before tax was impacted by higher cost of inventories sold, increased depreciation of right-of-use assets, and a larger reversal of trade receivables impairment Profit Before Tax Items | Item | For the six months ended June 30, 2025 (HKD in thousands) | For the six months ended June 30, 2024 (HKD in thousands) | | :--- | :--- | :--- | | Cost of inventories sold | 246,514 | 201,268 | | Depreciation of property, plant and equipment | 7,165 | 7,651 | | Depreciation of right-of-use assets | 9,417 | 7,345 | | Net reversal of impairment of trade receivables | (982) | (182) | | Reversal of write-down of inventories to net realisable value | (851) | (2,664) | [Income Tax](index=9&type=section&id=Income%20Tax) The Group's income tax expense decreased by 38.5% year-over-year, in line with lower pre-tax profit, while the effective tax rate remained stable Income Tax Expense Breakdown | Item | For the six months ended June 30, 2025 (HKD in thousands) | For the six months ended June 30, 2024 (HKD in thousands) | | :--- | :--- | :--- | | Current Hong Kong profits tax | 1,585 | 5,849 | | Current Mainland China profits tax | 2,277 | 3,826 | | Deferred tax | 1,361 | (996) | | Total tax charge for the period | 5,223 | 8,492 | - Hong Kong profits tax is calculated at **16.5%**, with the first HK$2 million of assessable profits for qualifying entities taxed at **8.25%**[22](index=22&type=chunk) [Dividends](index=10&type=section&id=Dividends) The Group recognized the 2024 final dividend and proposed a 2025 interim dividend of 7.0 HK cents per share, a decrease from the prior year Dividend Payments | Dividend Type | For the six months ended June 30, 2025 (HKD in thousands) | For the six months ended June 30, 2024 (HKD in thousands) | | :--- | :--- | :--- | | 2024 Final Dividend (16.1 HK cents per share) | 57,799 | 54,209 | | 2025 Proposed Interim Dividend (7.0 HK cents per share) | 25,130 | 39,490 | [Earnings Per Share](index=10&type=section&id=Earnings%20Per%20Share) The Group's basic earnings per share decreased by 38.0% year-over-year due to lower profit for the period, with no potential dilutive ordinary shares outstanding Earnings Per Share Calculation | Metric | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | | :--- | :--- | :--- | | Profit attributable to ordinary equity holders of the Company | HK$30,069,000 | HK$48,533,000 | | Weighted average number of ordinary shares in issue | 359,000,000 shares | 359,000,000 shares | | Basic earnings per share | 8.38 HK cents | 13.52 HK cents | - The Group had **no potential dilutive ordinary shares** in issue during the period[27](index=27&type=chunk) [Trade and Bills Receivables](index=10&type=section&id=Trade%20and%20Bills%20Receivables) The Group's net trade and bills receivables increased, with credit terms typically ranging from one to four months and a significant drop in receivables aged over 90 days Trade and Bills Receivables Breakdown | Metric | June 30, 2025 (HKD in thousands) | December 31, 2024 (HKD in thousands) | | :--- | :--- | :--- | | Trade receivables | 139,636 | 135,704 | | Bills receivable | 2,620 | – | | Impairment | (2,653) | (3,635) | | Net carrying amount | 139,603 | 132,069 | - The credit period is generally **one month**, extendable to **four months** for major customers[29](index=29&type=chunk) Ageing Analysis of Trade and Bills Receivables | Ageing | June 30, 2025 (HKD in thousands) | December 31, 2024 (HKD in thousands) | | :--- | :--- | :--- | | Within 30 days | 64,887 | 18,903 | | 31 to 90 days | 51,907 | 54,691 | | Over 90 days | 22,809 | 58,475 | | Total | 139,603 | 132,069 | [Trade Payables](index=11&type=section&id=Trade%20Payables) The Group's total trade payables increased significantly, with a higher proportion of payables aged over 90 days Ageing Analysis of Trade Payables | Ageing | June 30, 2025 (HKD in thousands) | December 31, 2024 (HKD in thousands) | | :--- | :--- | :--- | | Within 30 days | 32,516 | 13,231 | | 31 to 90 days | 66,704 | 43,056 | | Over 90 days | 9,258 | 2,167 | | Total | 108,478 | 58,454 | - Trade payables are **non-interest-bearing** and are normally settled within **30 to 90 days**[31](index=31&type=chunk) [Management Discussion and Analysis](index=12&type=section&id=Management%20Discussion%20and%20Analysis) [Business Review](index=12&type=section&id=Business%20Review) The Group demonstrated resilience amid macroeconomic challenges, mitigating supply chain risks and achieving significant revenue growth in Asia with new product launches - Global trade tensions, geopolitical conflicts, and supply chain disruptions persisted, with the **European market shrinking** due to declining purchasing power and currency fluctuations[32](index=32&type=chunk) - Strategic investments in **automation and standardization** improved manufacturing precision, supplier flexibility, inventory efficiency, and process resilience[32](index=32&type=chunk) - The product portfolio was expanded with price-competitive offerings, leading to a substantial increase in revenue from the Asian market from approximately **HK$24.0 million to HK$59.9 million**[33](index=33&type=chunk) [Outlook](index=12&type=section&id=Outlook) The Group will focus on sustainable growth by developing new product categories, leveraging advanced brewing systems, and expanding into China and the Middle East - Resources will shift from incremental product extensions to developing new product categories with long-term potential, initially focusing on **kitchen appliances for the Southeast Asian market**[34](index=34&type=chunk) - The upcoming revolutionary **fourth-generation fully automatic coffee machine** is expected to set new industry benchmarks and drive future growth[34](index=34&type=chunk) - The Group will accelerate product development cycles, enhance production automation, and actively explore the **Chinese and Middle Eastern markets** to diversify revenue streams[35](index=35&type=chunk)[36](index=36&type=chunk) [Financial Review](index=13&type=section&id=Financial%20Review) The Group's revenue increased, but gross and net profit declined significantly due to rising costs and product line optimization, while operating expenses were controlled [Revenue](index=13&type=section&id=Revenue_FR) The Group's total revenue increased by 8.4% year-over-year, primarily driven by higher sales of cooking appliances - Total revenue increased by approximately **8.4%** from approximately HK$301.9 million to approximately HK$327.3 million[37](index=37&type=chunk) - The increase was mainly attributable to the **increase in sales of cooking appliances** during the period[37](index=37&type=chunk) [Gross Profit and Gross Margin](index=14&type=section&id=Gross%20Profit%20and%20Gross%20Margin) Gross profit decreased by 19.8% and gross margin fell by 8.6 percentage points to 24.7%, mainly due to higher costs and the launch of lower-margin products - Gross profit decreased by approximately **19.8%** from approximately HK$100.7 million to approximately HK$80.8 million[38](index=38&type=chunk) - Gross profit margin decreased by approximately **8.6 percentage points** from approximately 33.3% to approximately 24.7%[38](index=38&type=chunk) - The decrease was mainly due to an **increase in direct labor costs and overheads**, as well as the launch of products with lower gross profit margins[38](index=38&type=chunk) [Other Income and Gains, Net](index=14&type=section&id=Other%20Income%20and%20Gains%2C%20Net_FR) Other income and gains, net, decreased by 28.0%, primarily due to the combined effect of lower bank interest income and reduced foreign exchange gains - Other income and gains, net, decreased by approximately HK$2.6 million from approximately HK$9.2 million to approximately **HK$6.6 million**[39](index=39&type=chunk) - The decrease was mainly due to a **decrease in bank interest income** of approximately HK$1.9 million and a **decrease in foreign exchange gains** of approximately HK$0.8 million[39](index=39&type=chunk) [Selling and Distribution Expenses](index=14&type=section&id=Selling%20and%20Distribution%20Expenses) Selling and distribution expenses slightly decreased, as lower advertising and staff costs were partially offset by higher transportation and export credit insurance expenses - Selling and distribution expenses slightly decreased by approximately HK$0.1 million from approximately HK$7.2 million to approximately **HK$7.1 million**[40](index=40&type=chunk) - The decrease was mainly due to a **decrease in advertising and promotion expenses** of approximately HK$0.2 million and a **decrease in staff costs** of approximately HK$0.3 million, offset by an increase in transportation expenses and export credit insurance premiums of approximately HK$0.3 million[40](index=40&type=chunk) [General and Administrative Expenses](index=15&type=section&id=General%20and%20Administrative%20Expenses) General and administrative expenses slightly decreased through effective cost control, despite increases in depreciation and employee benefit expenses - General and administrative expenses slightly decreased by approximately HK$0.6 million from approximately HK$44.8 million to approximately **HK$44.2 million**[41](index=41&type=chunk) - Major decreases included legal and professional fees, staff welfare expenses, office expenses, travel expenses, audit fees, entertainment expenses, and depreciation of property, plant and equipment[41](index=41&type=chunk) [Other Expenses, Net](index=15&type=section&id=Other%20Expenses%2C%20Net) Other expenses, net, shifted from a net expense to net income, primarily due to an increased reversal of impairment on trade receivables - Other expenses, net, recorded a **net income of approximately HK$0.9 million**, compared to a net expense of approximately HK$0.2 million in the prior period[42](index=42&type=chunk) - The improvement was mainly due to an **increase in the net reversal of impairment of trade receivables** of approximately HK$0.8 million during the period[42](index=42&type=chunk) [Finance Costs](index=15&type=section&id=Finance%20Costs) Finance costs increased by 70.0% year-over-year, mainly driven by higher interest expenses on lease liabilities and bank loans - Finance costs increased by approximately HK$0.7 million from approximately HK$1.0 million to approximately **HK$1.7 million**[43](index=43&type=chunk) - The increase was due to an **increase in interest expenses on lease liabilities** of approximately HK$0.5 million and an **increase in interest expenses on bank loans** of approximately HK$0.2 million[43](index=43&type=chunk) [Income Tax Expense](index=16&type=section&id=Income%20Tax%20Expense_FR) Income tax expense decreased by 38.8%, consistent with the decline in pre-tax profit, while the effective tax rate remained stable - Income tax expense decreased by approximately HK$3.3 million from approximately HK$8.5 million to approximately **HK$5.2 million**[44](index=44&type=chunk) - The effective tax rates were approximately **14.9% (2024) and 14.8% (2025)**, representing a decrease of approximately 0.1 percentage points[44](index=44&type=chunk) [Profit for the Period](index=16&type=section&id=Profit%20for%20the%20Period) Profit for the period decreased significantly by 38.0%, with the net profit margin falling 6.9 percentage points to 9.2%, primarily due to lower gross profit - Profit for the period decreased by approximately HK$18.4 million or approximately **38.0%** from approximately HK$48.5 million to approximately **HK$30.1 million**[45](index=45&type=chunk) - The net profit margin decreased by approximately **6.9 percentage points** from approximately 16.1% to approximately 9.2%[45](index=45&type=chunk) - The decrease was mainly attributable to the **decrease in gross profit** during the period[45](index=45&type=chunk) [Significant Acquisitions and Disposals](index=16&type=section&id=Significant%20Acquisitions%20and%20Disposals) The Group had no significant acquisitions or disposals of subsidiaries, associates, or joint ventures during the period - There were **no significant acquisitions or disposals** of subsidiaries, associates, or joint ventures during the period[46](index=46&type=chunk) [Capital Commitments](index=16&type=section&id=Capital%20Commitments) The Group's capital commitments for property, plant, and equipment decreased to approximately HK$5.8 million, to be funded by internal resources and share offer proceeds - As of June 30, 2025, total capital commitments amounted to approximately **HK$5.8 million** (December 31, 2024: approximately HK$6.5 million)[47](index=47&type=chunk) - Approximately **HK$0.7 million** will be settled by the net proceeds from the share offer, with the balance settled by the Group's internal resources[47](index=47&type=chunk) [Contingent Liabilities](index=17&type=section&id=Contingent%20Liabilities) As of June 30, 2025, the Group had no significant contingent liabilities - As of June 30, 2025, the Group did **not have any significant contingent liabilities**[48](index=48&type=chunk) [Foreign Exchange Risk](index=17&type=section&id=Foreign%20Exchange%20Risk) The Group is exposed to foreign exchange risk from USD and RMB transactions but did not engage in currency hedging as the risk was considered minimal - The Group conducts certain transactions denominated in **USD and RMB**, thus exposing it to exchange rate fluctuation risks[49](index=49&type=chunk) - As the exchange rate fluctuation risk was not significant, the Group did **not engage in foreign currency hedging** during the period[49](index=49&type=chunk) [Future Plans for Major Investments and Capital Assets](index=17&type=section&id=Future%20Plans%20for%20Major%20Investments%20and%20Capital%20Assets) The Group plans to acquire a property in Hong Kong for approximately HK$7.1 million to expand its workshop, warehouse, and office space, funded by internal resources - On July 16, 2025, the Group entered into a provisional agreement to acquire a property at **Unit B, 20/F, Wyler Centre, 403 Castle Peak Road, Kwai Chung, New Territories, Hong Kong** for approximately HK$7.1 million[50](index=50&type=chunk) - The Group plans to **expand its existing workshop, warehouse, and ancillary office** into the property[50](index=50&type=chunk) - The acquisition will be financed by internal resources and is expected to be completed on or before **September 16, 2025**[50](index=50&type=chunk) [Gearing Ratio](index=18&type=section&id=Gearing%20Ratio) The Group's gearing ratio decreased to approximately 7.7%, primarily due to a reduction in interest-bearing bank borrowings during the period - As of June 30, 2025, the Group's gearing ratio was approximately **7.7%** (December 31, 2024: approximately 11.3%)[51](index=51&type=chunk) - The decrease was mainly due to the **reduction in the Group's interest-bearing bank borrowings** during the period[51](index=51&type=chunk) [Liquidity and Financial Resources and Capital Structure](index=18&type=section&id=Liquidity%20and%20Financial%20Resources%20and%20Capital%20Structure) The Group maintained a conservative financing policy, with increased cash reserves but a slightly lower current ratio and reduced total interest-bearing bank borrowings - The Group primarily funds its liquidity and capital requirements through **shareholder contributions, bank borrowings, and net cash from operating activities**[52](index=52&type=chunk) Liquidity Metrics | Metric | June 30, 2025 (HKD in thousands / ratio) | December 31, 2024 (HKD in thousands / ratio) | | :--- | :--- | :--- | | Cash and cash equivalents | 79,111 | 75,894 | | Current ratio | 1.7 times | 2.0 times | | Total interest-bearing bank borrowings | 25,576 | 39,975 | - All bank borrowings are at **floating interest rates**, referencing HIBOR and CNH HIBOR[54](index=54&type=chunk) [Principal Risks and Uncertainties](index=20&type=section&id=Principal%20Risks%20and%20Uncertainties) The Group faces multiple risks, including disease outbreaks, geopolitical conflicts, changing consumer preferences, and reliance on a few major customers - Business and operations may be severely affected by **outbreaks of infectious diseases** or other public health events[56](index=56&type=chunk) - Ongoing military conflicts in Russia-Ukraine and the Middle East may impact **global supply chains, logistics, consumer sentiment, and demand**[56](index=56&type=chunk) - The Group **relies on a few major customers**, and any deterioration in these relationships could have a material adverse effect on performance[56](index=56&type=chunk) - Failure to meet customer demands and preferences for product design, R&D, and manufacturing could **adversely affect operating results**[56](index=56&type=chunk) [Material Investments Held](index=21&type=section&id=Material%20Investments%20Held) As of June 30, 2025, the Company held no material investments other than its investments in various subsidiaries - Other than the Company's investments in its various subsidiaries, the Company did **not hold any material investments** as of June 30, 2025[57](index=57&type=chunk) [Employees and Remuneration Policies](index=21&type=section&id=Employees%20and%20Remuneration%20Policies) The Group's full-time employee count slightly decreased, with remuneration based on merit and market conditions, while total staff costs increased - As of June 30, 2025, the Group had a total of **1,065 full-time employees** (December 31, 2024: 1,075)[58](index=58&type=chunk) - The remuneration policy is determined by reference to factors such as **qualifications, experience, performance, merits, responsibilities, and market conditions**[58](index=58&type=chunk) - Total staff costs (excluding directors' remuneration) were approximately **HK$61.0 million** (2024 period: approximately HK$54.4 million)[58](index=58&type=chunk) [Use of Proceeds from Share Offer](index=21&type=section&id=Use%20of%20Proceeds%20from%20Share%20Offer) The Company has utilized approximately HK$89.7 million of the net proceeds from its share offer, with the remaining HK$1.0 million expected to be used by June 2026 - The net proceeds from the share offer were approximately **HK$90.7 million**[59](index=59&type=chunk) - From the listing date to June 30, 2025, the Company utilized approximately **HK$89.7 million** of the net proceeds, with an unutilized balance of approximately HK$1.0 million[60](index=60&type=chunk) - The remaining proceeds allocated for upgrading the IT system are expected to be fully utilized by **June 30, 2026**, due to further delays[60](index=60&type=chunk) [Other Information](index=23&type=section&id=Other%20Information) [Compliance with Corporate Governance Code](index=23&type=section&id=Compliance%20with%20Corporate%20Governance%20Code) The Company confirms its compliance with all applicable principles and code provisions of the Corporate Governance Code during the period - The Company has **complied with all applicable principles and code provisions** of the Corporate Governance Code[61](index=61&type=chunk) [Standard of Dealings in Securities by Directors](index=23&type=section&id=Standard%20of%20Dealings%20in%20Securities%20by%20Directors) All directors have confirmed their full compliance with the required standards set out in the Model Code for Securities Transactions by Directors - Each Director has confirmed their **full compliance with the required standards** set out in the Model Code during the period and up to the date of this announcement[62](index=62&type=chunk) [Dividend Declaration](index=23&type=section&id=Dividend%20Declaration) The Board has declared an interim dividend of 7.0 HK cents per ordinary share for the six months ended June 30, 2025, totaling approximately HK$25.1 million - The Board has resolved to declare an interim dividend of **7.0 HK cents per ordinary share** for the six months ended June 30, 2025[63](index=63&type=chunk) - The total amount is approximately **HK$25.1 million** (2024 period: approximately HK$39.5 million)[63](index=63&type=chunk) [Closure of Register of Members](index=23&type=section&id=Closure%20of%20Register%20of%20Members) The register of members will be closed from September 12 to September 15, 2025, to determine entitlement to the interim dividend - The register of members will be closed from **Friday, September 12, 2025, to Monday, September 15, 2025**, both days inclusive[64](index=64&type=chunk) - To qualify for the interim dividend, all completed transfer forms must be lodged with the Company's Hong Kong branch share registrar no later than **4:30 p.m. on Thursday, September 11, 2025**[64](index=64&type=chunk) [Purchase, Sale or Redemption of Listed Securities](index=24&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%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[65](index=65&type=chunk) [Events After the Reporting Period](index=24&type=section&id=Events%20After%20the%20Reporting%20Period) The Group entered into a formal sale and purchase agreement for the acquisition of Unit 20B on July 30, 2025, with completion expected by September 16, 2025 - The Group entered into a **formal sale and purchase agreement** with an independent third party for the acquisition of Unit 20B on July 30, 2025[66](index=66&type=chunk) - The acquisition of Unit 20B is expected to be completed on or before **September 16, 2025**[66](index=66&type=chunk) [Review by Audit Committee](index=24&type=section&id=Review%20by%20Audit%20Committee) The Audit Committee has reviewed the Group's unaudited interim financial information and found it compliant with applicable standards and rules - The Audit Committee comprises **four independent non-executive Directors** and complies with Rule 3.21 of the Listing Rules[67](index=67&type=chunk) - The Audit Committee has concluded that the unaudited interim financial information complies with applicable accounting standards and Listing Rules, and that **adequate disclosures have been made**[67](index=67&type=chunk) [Publication of Interim Results Announcement and Interim Report](index=25&type=section&id=Publication%20of%20Interim%20Results%20Announcement%20and%20Interim%20Report) This interim results announcement is available on the websites of the Stock Exchange and the Company, with the interim report to follow in September 2025 - This interim results announcement is published on the **websites of the Stock Exchange and the Company**[68](index=68&type=chunk) - The interim report for the period will be published on the same websites in **September 2025** in accordance with the Listing Rules[68](index=68&type=chunk) [Acknowledgement](index=25&type=section&id=Acknowledgement) The Board extends its sincere gratitude to the management team, staff, shareholders, and business partners for their support and contributions [Board of Directors](index=25&type=section&id=Board%20of%20Directors) As of the date of this announcement, the Board of Directors comprises executive, non-executive, and independent non-executive members - The Board of Directors includes **Executive Directors** Mr Chan Wai Ming, Mr Chiu Wai Kwong, Ms Tang Mei Wah, and Dr Yu Kwok Wai; **Non-executive Directors** Dr Chan Kam Kwong and Ms Cheng Yuk Han; and **Independent Non-executive Directors** Mr Choy Chi Leung, Mr Chan Shing Chi, Ms Chan Tak Yi, and Ms Leung Lai Yi[70](index=70&type=chunk)

[Company Announcement Information](index=1&type=section&id=Company%20Announcement%20Information) This announcement presents Jilin Province Chuncheng Heat Power Co., Ltd.'s (stock code: 1853) unaudited interim results for the first half of 2025 - This announcement is the 2025 interim results announcement issued by Jilin Province Chuncheng Heat Power Co., Ltd. (stock code: 1853)[2](index=2&type=chunk) [Financial Highlights](index=1&type=section&id=Financial%20Highlights) The group's unaudited interim results for the six months ended June 30, 2025, prepared under PRC accounting standards, have been reviewed by the audit committee - The Group's unaudited interim results for the six months ended June 30, 2025, prepared in accordance with China Enterprise Accounting Standards, have been reviewed by the Audit Committee[4](index=4&type=chunk) Key Financial Indicators for H1 2025 | Indicator | 2025 H1 (RMB) | YoY Change | | :--- | :--- | :--- | | Revenue | 935.13 million | +3.14% | | Profit before tax | 143.64 million | -28.40% | | Net profit attributable to equity holders | 106.90 million | -27.84% | | Earnings per share | 0.23 | Decreased by 0.09 | [Financial Statements](index=2&type=section&id=Financial%20Statements) This section provides detailed consolidated financial statements, including the balance sheet, income statement, and comprehensive income statement [Consolidated Balance Sheet](index=2&type=section&id=Consolidated%20Balance%20Sheet) As of June 30, 2025, the Group's total assets and liabilities significantly decreased from year-end 2024, while shareholders' equity increased, reflecting asset structure adjustments and accumulated profits Key Consolidated Balance Sheet Data | Indicator | June 30, 2025 (RMB) | December 31, 2024 (RMB) | Change | | :--- | :--- | :--- | :--- | | Total current assets | 1,377,354,891.21 | 2,676,804,769.68 | -48.55% | | Total non-current assets | 1,090,760,220.90 | 1,069,031,309.98 | +2.03% | | **Total Assets** | **2,468,115,112.11** | **3,745,836,079.66** | **-34.11%** | | Total current liabilities | 1,202,935,543.39 | 2,578,974,059.36 | -53.36% | | Total non-current liabilities | 115,116,319.82 | 123,702,208.21 | -6.94% | | **Total Liabilities** | **1,318,051,863.21** | **2,702,676,267.57** | **-51.10%** | | Total equity attributable to parent company shareholders | 1,150,063,248.90 | 1,043,159,812.09 | +10.25% | | **Total Shareholders' Equity** | **1,150,063,248.90** | **1,043,159,812.09** | **+10.25%** | [Consolidated Income Statement](index=6&type=section&id=Consolidated%20Income%20Statement) In H1 2025, the Group's total operating revenue increased year-on-year, but operating profit and net profit significantly declined due to increased operating costs, finance costs, and asset impairment losses Key Consolidated Income Statement Data (H1 2025 vs H1 2024) | Indicator | 2025 Jan-Jun (RMB) | 2024 Jan-Jun (RMB) | YoY Change | | :--- | :--- | :--- | :--- | | Total operating revenue | 935,134,299.91 | 906,629,256.98 | +3.14% | | Operating cost | 745,469,319.23 | 686,590,830.07 | +8.58% | | Finance costs | 9,397,905.71 | 1,720,984.50 | +446.07% | | Asset impairment losses | -2,382,244.28 | 21,627,705.85 | From gain to loss | | Operating profit | 143,641,144.97 | 200,682,399.11 | -28.43% | | Total profit | 143,635,744.05 | 200,617,153.89 | -28.40% | | Income tax expense | 36,732,307.24 | 52,475,162.44 | -30.00% | | Net profit | 106,903,436.81 | 148,141,991.45 | -27.84% | | Net profit attributable to owners of the parent company | 106,903,436.81 | 148,141,991.45 | -27.84% | [Consolidated Statement of Comprehensive Income](index=7&type=section&id=Consolidated%20Statement%20of%20Comprehensive%20Income) The Group's total comprehensive income for H1 2025 was RMB 106.90 million, consistent with net profit, with no other comprehensive income items Key Consolidated Statement of Comprehensive Income Data (H1 2025 vs H1 2024) | Indicator | 2025 Jan-Jun (RMB) | 2024 Jan-Jun (RMB) | | :--- | :--- | :--- | | Net profit | 106,903,436.81 | 148,141,991.45 | | Other comprehensive income, net of tax | – | – | | **Total Comprehensive Income** | **106,903,436.81** | **148,141,991.45** | | Total comprehensive income attributable to owners of the parent company | 106,903,436.81 | 148,141,991.45 | - There were no ordinary shares with potential dilutive effects issued in the current or prior period, thus diluted earnings per share are the same as basic earnings per share[23](index=23&type=chunk) [Notes to Financial Information](index=9&type=section&id=Notes%20to%20Financial%20Information) This section provides detailed notes on the Group's financial information, including company overview, accounting policies, segment information, and specific financial line items [1. Company Overview](index=9&type=section&id=1.%20Company%20Overview) Jilin Province Chuncheng Heat Power Co., Ltd., established in China in 2017, primarily engages in heating, construction, maintenance, and design services, with Changchun Heating (Group) Co., Ltd. as its controlling shareholder - The Company was incorporated in the People's Republic of China on October 23, 2017, and is currently a joint stock company[13](index=13&type=chunk) - The Group's principal activities include heating (heating and heat transmission, connection fees, and heat transmission) and construction, maintenance, design, and other services[14](index=14&type=chunk) - The Company's controlling shareholder is Changchun Heating Group, wholly owned by the Changchun Municipal People's Government State-owned Assets Supervision and Administration Commission[14](index=14&type=chunk) [2. Significant Accounting Policies](index=9&type=section&id=2.%20Significant%20Accounting%20Policies) The Group's consolidated financial statements are primarily measured using the historical cost method and are consistent with the accounting policies and calculation methods of the previous year - The consolidated financial statements are measured at historical cost, except for certain financial instruments measured at fair value[15](index=15&type=chunk) - The accounting policies and calculation methods adopted for the consolidated financial statements for the six months ended June 30, 2025, are consistent with those followed in the preparation of the annual financial statements for the year ended December 31, 2024[15](index=15&type=chunk) [3. Revenue and Segment Information](index=9&type=section&id=3.%20Revenue%20and%20Segment%20Information) The Group reports financial information based on two operating segments: heating and construction, maintenance, and design services; in H1 2025, heating business revenue accounted for the vast majority, while construction, maintenance, and design services revenue was smaller but grew significantly [3.(1) Basis for Determining Reporting Segments and Accounting Policies](index=9&type=section&id=3.(1)%20Basis%20for%20Determining%20Reporting%20Segments%20and%20Accounting%20Policies) - The Company determines two operating segments, heating and construction, maintenance, and design services, based on its internal organizational structure, management requirements, and internal reporting system[16](index=16&type=chunk) - Management separately manages the operating activities of each reporting segment and regularly evaluates their operating results to allocate resources and assess performance[16](index=16&type=chunk) [3.(2)(1) Financial Information of Reporting Segments](index=10&type=section&id=3.(2)(1)%20Financial%20Information%20of%20Reporting%20Segments) Segment Assets, Liabilities, and Revenue (June 30, 2025) | Item | Heating (RMB) | Construction, Maintenance, and Design Services (RMB) | Total (RMB) | | :--- | :--- | :--- | :--- | | Segment assets | 2,210,700,559.64 | 257,414,552.47 | 2,468,115,112.11 | | Segment liabilities | 1,223,499,374.24 | 94,552,488.97 | 1,318,051,863.21 | | Reportable segment revenue (H1 2025) | 926,331,893.76 | 8,802,406.15 | 935,134,299.91 | | Reportable segment gross profit (H1 2025) | 191,116,646.50 | -1,451,665.82 | 189,664,980.68 | [3.(2)(2) Revenue and Other Business Income](index=10&type=section&id=3.(2)(2)%20Revenue%20and%20Other%20Business%20Income) Revenue from Customer Contracts Details (H1 2025 vs H1 2024) | Item | 2025 Jan-Jun (RMB) | 2024 Jan-Jun (RMB) | | :--- | :--- | :--- | | Heating and heat transmission | 884,923,601.99 | 859,996,290.50 | | Connection fees | 35,108,205.62 | 33,624,881.16 | | Heat transmission | 6,300,086.15 | 6,702,695.84 | | Engineering construction | 5,710,502.31 | 1,895,403.15 | | Engineering maintenance | 6,902.00 | 2,541,378.58 | | Design services | 100,622.38 | 1,676,775.53 | | Other | 2,984,379.46 | 191,832.22 | | **Total** | **935,134,299.91** | **906,629,256.98** | [4. Administrative Expenses](index=11&type=section&id=4.%20Administrative%20Expenses) The Group's administrative expenses for H1 2025 were RMB 42.70 million, a slight decrease from the same period last year, primarily comprising labor costs and depreciation and amortization expenses Administrative Expenses (H1 2025 vs H1 2024) | Item | 2025 Jan-Jun (RMB) | 2024 Jan-Jun (RMB) | | :--- | :--- | :--- | | Administrative expenses | 42,703,122.46 | 43,227,227.39 | - Administrative expenses primarily consist of labor costs, depreciation and amortization expenses, etc[19](index=19&type=chunk) [5. Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA)](index=11&type=section&id=5.%20Earnings%20Before%20Interest%2C%20Taxes%2C%20Depreciation%2C%20and%20Amortization%20(EBITDA)) The Group's EBITDA for H1 2025 was RMB 213 million, a decrease from the same period last year, mainly affected by changes in net profit and interest expenses EBITDA (H1 2025 vs H1 2024) | Item | 2025 Jan-Jun (RMB) | 2024 Jan-Jun (RMB) | | :--- | :--- | :--- | | Net profit | 106,903,436.81 | 148,141,991.45 | | Income tax expense | 36,732,307.24 | 52,475,162.44 | | Depreciation of fixed assets | 70,529,485.38 | 66,888,092.64 | | Amortization of intangible assets | 757,872.55 | 668,972.13 | | Interest and investment income | 11,383,806.88 | 8,763,445.66 | | Interest expense | 9,397,905.71 | 1,720,984.50 | | **EBITDA** | **212,937,200.81** | **261,149,142.82** | [6. Dividends](index=11&type=section&id=6.%20Dividends) The Board does not recommend an interim dividend for H1 2025; the final dividend for FY2024 was approved but not yet distributed - The Board does not recommend the payment of any interim dividend to shareholders for the six months ended June 30, 2025[21](index=21&type=chunk) - The final dividend of **RMB 0.065 per share** (inclusive of tax) for the financial year ended December 31, 2024, was approved at the 2024 annual general meeting but had not been distributed as of June 30, 2025[22](index=22&type=chunk) [7. Earnings Per Share](index=12&type=section&id=7.%20Earnings%20Per%20Share) The Group's earnings per share for H1 2025 was RMB 0.23, a decrease from the same period last year, with basic and diluted EPS being identical Earnings Per Share (H1 2025 vs H1 2024) | Item | 2025 Jan-Jun | 2024 Jan-Jun | | :--- | :--- | :--- | | Net profit attributable to parent company | 106,903,436.81 | 148,141,991.45 | | Weighted average number of ordinary shares issued during the period | 466,700,000.00 | 466,700,000.00 | | **Earnings Per Share** | **0.23** | **0.32** | - As of June 30, 2025, and 2024, there were no ordinary shares with potential dilutive effects issued for the six months ended, thus diluted earnings per share are the same as basic earnings per share[23](index=23&type=chunk) [8. Income Tax Expense](index=12&type=section&id=8.%20Income%20Tax%20Expense) The Group's income tax expense for H1 2025 was RMB 36.73 million, a 30% decrease year-on-year, primarily due to a decline in total profit Income Tax Expense (H1 2025 vs H1 2024) | Item | 2025 Jan-Jun (RMB) | 2024 Jan-Jun (RMB) | | :--- | :--- | :--- | | Current income tax expense | 40,560,755.05 | 53,138,389.25 | | Deferred income tax expense | -3,828,447.81 | -663,226.81 | | **Total** | **36,732,307.24** | **52,475,162.44** | - The decrease in income tax expense was mainly due to the decrease in total profit for the current period[61](index=61&type=chunk) [9. Accounts Receivable](index=13&type=section&id=9.%20Accounts%20Receivable) The Group's total accounts receivable and allowance for doubtful accounts both increased, with significant growth in receivables aged 1-2 years and over 5 years, reflecting challenges in collection [9.(1) Accounts Receivable by Ageing](index=13&type=section&id=9.(1)%20Accounts%20Receivable%20by%20Ageing) Accounts Receivable Ageing Analysis (June 30, 2025 vs December 31, 2024) | Ageing | June 30, 2025 (RMB) | December 31, 2024 (RMB) | | :--- | :--- | :--- | | Within 1 year | 94,805,548.81 | 240,784,530.94 | | 1 to 2 years | 120,088,965.53 | 50,660,189.88 | | 2 to 3 years | 40,011,168.25 | 16,463,637.23 | | 3 to 4 years | 14,507,308.95 | 18,091,660.10 | | 4 to 5 years | 16,273,134.02 | 8,163,363.23 | | Over 5 years | 24,521,871.23 | 17,834,792.54 | | Subtotal | 310,207,996.79 | 351,998,173.92 | | Less: Allowance for doubtful accounts | 65,755,050.07 | 59,544,145.46 | | **Total** | **244,452,946.72** | **292,454,028.46** | [9.(2) Disclosure by Method of Provision for Doubtful Accounts](index=14&type=section&id=9.(2)%20Disclosure%20by%20Method%20of%20Provision%20for%20Doubtful%20Accounts) Provision for Doubtful Accounts by Credit Risk Characteristics Portfolio (June 30, 2025) | Category | Carrying Amount (RMB) | Proportion (%) | Allowance for Doubtful Accounts (RMB) | Provision Rate (%) | Carrying Value (RMB) | | :--- | :--- | :--- | :--- | :--- | :--- | | By credit risk characteristics portfolio | 310,207,996.79 | 100.00 | 65,755,050.07 | 21.20 | 244,452,946.72 | | Of which: Ageing portfolio – Heating business | 98,191,505.71 | 31.65 | 11,046,958.40 | 11.25 | 87,144,547.31 | | Ageing portfolio – Basic heating fees | 36,422,356.51 | 11.74 | 10,174,084.70 | 27.93 | 26,248,271.81 | | Ageing portfolio – Engineering business | 60,256,061.91 | 19.42 | 28,149,415.16 | 46.72 | 32,106,646.75 | | Related party portfolio | 115,338,072.66 | 37.19 | 16,384,591.81 | 14.21 | 98,953,480.85 | [9.(3) Provision for Doubtful Accounts by Credit Risk Characteristics Portfolio](index=15&type=section&id=9.(3)%20Provision%20for%20Doubtful%20Accounts%20by%20Credit%20Risk%20Characteristics%20Portfolio) - The provision rates for doubtful accounts for ageing portfolios in heating business, basic heating fees, and engineering business increase with ageing, with a **100% provision rate for receivables over 5 years**[30](index=30&type=chunk)[31](index=31&type=chunk)[32](index=32&type=chunk) [10. Accounts Payable](index=17&type=section&id=10.%20Accounts%20Payable) The Group's total accounts payable significantly decreased from year-end 2024, but accounts payable aged 1-2 years and over 3 years increased Accounts Payable Ageing Analysis (June 30, 2025 vs December 31, 2024) | Ageing | June 30, 2025 (RMB) | December 31, 2024 (RMB) | | :--- | :--- | :--- | | Within 1 year | 17,652,359.36 | 228,146,149.72 | | 1 – 2 years | 33,790,937.76 | 14,745,559.16 | | 2 – 3 years | 4,350,737.23 | 39,714,923.61 | | Over 3 years | 36,609,707.51 | 5,726,739.83 | | **Total** | **92,403,741.86** | **288,333,372.32** | [I. Business Review](index=18&type=section&id=I.%20Business%20Review) This section reviews the Group's operational performance, including heating business, construction, maintenance, design, safety management, and technology and R&D [(I) Heating Business](index=18&type=section&id=(I)%20Heating%20Business) The Group's heating business achieved steady growth in H1 2025, with increases in heating area and customer numbers, and revenue growing by 2.89% year-on-year - As of June 30, 2025, the Group's heating area was **69.826 million square meters**, a year-on-year increase of **3.54%**[35](index=35&type=chunk) - The number of heating customers was **572,273 households**, a year-on-year increase of **3.59%**[35](index=35&type=chunk) - Heating business revenue was **RMB 926.33 million**, a year-on-year increase of **2.89%**[35](index=35&type=chunk) Heating Customer Numbers and Revenue Contribution (June 30, 2025 vs June 30, 2024) | Customer Type | 2025 H1 Customer Count | % of Heating & Heat Transmission Revenue | 2024 H1 Customer Count | % of Heating & Heat Transmission Revenue | | :--- | :--- | :--- | :--- | :--- | | Residential users | 505,761 | 88.38% | 493,789 | 89.38% | | Non-residential users | 66,512 | 11.62% | 58,659 | 10.62% | | **Total** | **572,273** | **100%** | **552,448** | **100%** | - In H1 2025, the Group purchased a total of **12.41 million gigajoules** of heat sources, of which **11.28 million gigajoules** were used for heating production[38](index=38&type=chunk) - Approximately **1.13 million gigajoules** of heat were resold, generating heat transmission fees of **RMB 6.30 million**[39](index=39&type=chunk) Purchased Heat Usage Data (H1 2025 vs H1 2024) | Item | 2025 Jan-Jun (Gigajoules) | 2024 Jan-Jun (Gigajoules) | | :--- | :--- | :--- | | Estimated heat purchase quota | 13,670,000 | 13,900,000 | | Transferred heat purchase quota | 1,128,955 | 1,152,499 | | Actual consumption | 11,282,780 | 11,557,948 | | Total heat purchased | 12,411,736 | 12,710,447 | | Utilization rate | 82.54% | 83.15% | [(II) Construction, Maintenance, Design, and Other Services](index=20&type=section&id=(II)%20Construction%2C%20Maintenance%2C%20Design%2C%20and%20Other%20Services) The Group's construction, maintenance, design, and other services revenue significantly grew by 39.60% in H1 2025, undertaking several key engineering projects - Revenue from this business was **RMB 8.80 million**, a year-on-year increase of **39.60%**[41](index=41&type=chunk) - In the first half of the year, a total of 15 engineering construction projects, 2 engineering maintenance projects, and 9 design service projects were undertaken, including key projects such as the "Changchun Aviation Expo Park Pipeline Network Project"[41](index=41&type=chunk) [(III) Safety Management](index=20&type=section&id=(III)%20Safety%20Management) The Group prioritized safety production in H1 2025, fully implementing government directives, and experienced no major safety accidents during the reporting period - The Group fully implemented the decisions and deployments of government departments at all levels regarding safety production and strictly fulfilled its safety production management responsibilities[42](index=42&type=chunk) - No major safety accidents occurred during the reporting period[42](index=42&type=chunk) [(IV) Technology and R&D](index=20&type=section&id=(IV)%20Technology%20and%20R%26D) The Group made progress in environmental facility upgrades and equipment management digitalization, achieving ultra-low emission standards for boilers and independently developing an equipment ledger management system, obtaining two utility model patents - Completed SCR ultra-low emission modification tests for 15 boilers in 3 boiler rooms, all meeting national super emission standards, expected to significantly reduce particulate matter, sulfur dioxide, and nitrogen oxide emissions[43](index=43&type=chunk) - The independently developed "Equipment Ledger Management System" was fully optimized and put into use, achieving refined and convenient equipment management[44](index=44&type=chunk) - Obtained **2 utility model patents** issued by the National Intellectual Property Administration during the reporting period[45](index=45&type=chunk) [II. Analysis of Financial Position and Operating Results](index=21&type=section&id=II.%20Analysis%20of%20Financial%20Position%20and%20Operating%20Results) This section analyzes the Group's financial performance, covering revenue, other income, operating costs, gross profit, expenses, and liquidity [(I) Revenue](index=21&type=section&id=(I)%20Revenue) The Group's total revenue for H1 2025 was RMB 935.13 million, a 3.14% year-on-year increase, primarily driven by increased heating business revenue - For the six months ended June 30, 2025, the Group's revenue was **RMB 935.13 million**, a year-on-year increase of **3.14%**[46](index=46&type=chunk) - The increase in revenue was mainly due to the increase in heating business revenue[46](index=46&type=chunk) Revenue Details by Segment (H1 2025 vs H1 2024) | Segment | 2025 (RMB million) | 2024 (RMB million) | Change Rate | | :--- | :--- | :--- | :--- | | Heating | 926.33 | 900.32 | 2.89% | | Construction, maintenance, and design services | 8.80 | 6.31 | 39.60% | | **Total** | **935.13** | **906.63** | **3.14%** | [(II) Other Income and Net Other Gains](index=22&type=section&id=(II)%20Other%20Income%20and%20Net%20Other%20Gains) The Group's other income and net other gains increased by 34.00% year-on-year in H1 2025, driven by higher government subsidies and bank deposit interest income - For the six months ended June 30, 2025, other income and net other gains were **RMB 15.54 million**, a year-on-year increase of **34.00%**[49](index=49&type=chunk) - The increase was mainly due to increased government subsidies, such as heating subsidies (**+47.20%**), and increased interest income from bank deposits (**+29.90%**)[49](index=49&type=chunk) [(III) Operating Costs](index=22&type=section&id=(III)%20Operating%20Costs) The Group's operating costs increased by 8.58% year-on-year in H1 2025, primarily due to higher heat purchase costs, coal costs, depreciation and amortization, and utility fees in the heating business [Operating Costs of Heating Business](index=22&type=section&id=Operating%20Costs%20of%20Heating%20Business) Operating Costs by Business Segment (H1 2025 vs H1 2024) | Segment | 2025 (RMB million) | 2024 (RMB million) | Change Rate | | :--- | :--- | :--- | :--- | | Heating | 735.22 | 680.33 | 8.07% | | Construction, maintenance, and design services | 10.25 | 6.26 | 63.78% | | **Total** | **745.47** | **686.59** | **8.58%** | Heating Sales Cost Details (H1 2025 vs H1 2024) | Item | 2025 (RMB million) | 2024 (RMB million) | Change Rate | | :--- | :--- | :--- | :--- | | Heat purchase cost | 436.96 | 419.78 | 4.09% | | Coal | 46.13 | 20.77 | 122.10% | | Maintenance and repair | 6.90 | 6.86 | 0.47% | | Labor | 76.84 | 76.64 | 0.25% | | Depreciation and amortization | 69.06 | 64.12 | 7.70% | | Utilities | 49.38 | 44.79 | 10.25% | | Input tax transfer out | 29.75 | 28.79 | 3.32% | | Other | 20.21 | 18.58 | 8.79% | | **Total** | **735.22** | **680.33** | **8.07%** | - The **4.09% increase in heat purchase cost** was mainly due to increased heat source consumption from expanded heating area[54](index=54&type=chunk) - The **122.10% increase in coal cost** was mainly due to the addition of new peak-shaving coal-fired boilers and increased coal consumption in the current period[55](index=55&type=chunk) - The **7.70% increase in depreciation and amortization cost** was mainly due to new fixed asset investments in the prior and current periods[56](index=56&type=chunk) - The **10.25% increase in utility costs** was mainly due to the continuous expansion of heating area[56](index=56&type=chunk) [Construction, Maintenance, and Design Services Costs](index=24&type=section&id=Construction%2C%20Maintenance%2C%20and%20Design%20Services%20Costs) - Operating costs for construction, maintenance, and design services were **RMB 10.25 million**, a year-on-year increase of **63.78%**, largely consistent with the increase in revenue from this business[57](index=57&type=chunk) [(IV) Gross Profit and Gross Margin](index=24&type=section&id=(IV)%20Gross%20Profit%20and%20Gross%20Margin) The Group's gross profit for H1 2025 was RMB 189.67 million, a 13.80% year-on-year decrease, primarily due to increased coal-fired heating proportion and rising costs from new peak-shaving coal-fired boilers - For the six months ended June 30, 2025, the Group's gross profit was **RMB 189.67 million**, a year-on-year decrease of **13.80%**[58](index=58&type=chunk) - The decrease in gross profit was mainly due to the addition of new peak-shaving coal-fired boilers in the current period, leading to an increased proportion of coal-fired heating and higher costs[58](index=58&type=chunk) [(V) Administrative Expenses](index=25&type=section&id=(V)%20Administrative%20Expenses) The Group's administrative expenses for H1 2025 were RMB 42.70 million, remaining largely stable with a slight decrease of 1.21% compared to the same period last year - For the six months ended June 30, 2025, the Group's administrative expenses were **RMB 42.70 million**, a year-on-year decrease of **1.21%**[59](index=59&type=chunk) [(VI) Finance Costs](index=25&type=section&id=(VI)%20Finance%20Costs) The Group's finance costs significantly increased by 446.07% to RMB 9.40 million in H1 2025, primarily due to higher interest expenses from increased bank loans - For the six months ended June 30, 2025, the Group's finance costs were **RMB 9.40 million**, a year-on-year increase of **446.07%**[60](index=60&type=chunk) - The increase was mainly due to an increase in bank loans in the current period compared to the prior period, leading to higher interest expenses[60](index=60&type=chunk) [(VII) Income Tax Expense](index=25&type=section&id=(VII)%20Income%20Tax%20Expense) The Group's income tax expense for H1 2025 was RMB 36.73 million, a 30.00% year-on-year decrease, primarily due to a decline in total profit - For the six months ended June 30, 2025, the Group's income tax expense was **RMB 36.73 million**, a year-on-year decrease of **30.00%**[61](index=61&type=chunk) - The decrease was mainly due to the decrease in total profit for the current period[61](index=61&type=chunk) [(VIII) Profit for the Period](index=25&type=section&id=(VIII)%20Profit%20for%20the%20Period) The Group's profit for H1 2025 was RMB 106.90 million, a 27.84% year-on-year decrease, mainly impacted by lower gross profit and increased provision for doubtful accounts - For the six months ended June 30, 2025, the Group's profit for the period was **RMB 106.90 million**, a year-on-year decrease of **27.84%**[62](index=62&type=chunk) - The decrease was mainly due to a **RMB 30.07 million decrease in gross profit** compared to the same period last year, and an additional **RMB 23.84 million provision for doubtful accounts** in the current period compared to the prior year[62](index=62&type=chunk) [(IX) Profit Attributable to Owners of the Company](index=25&type=section&id=(IX)%20Profit%20Attributable%20to%20Owners%20of%20the%20Company) The Group's profit attributable to owners of the Company for H1 2025 was RMB 106.90 million, a 27.84% year-on-year decrease, consistent with the profit for the period - For the six months ended June 30, 2025, the profit attributable to owners of the Company was **RMB 106.90 million**, a year-on-year decrease of **27.84%**[63](index=63&type=chunk) - The profit attributable to owners of the Company is consistent with the profit for the period[63](index=63&type=chunk) [(X) Liquidity and Capital Resources](index=25&type=section&id=(X)%20Liquidity%20and%20Capital%20Resources) The Group's cash and cash equivalents decreased by 16.88% in H1 2025, primarily due to increased cost expenditures from new peak-shaving coal-fired boilers - As of June 30, 2025, the Group held cash and cash equivalents of **RMB 460.36 million**, a decrease of **16.88%** compared to December 31, 2024[64](index=64&type=chunk) - The decrease was mainly due to the addition of new peak-shaving coal-fired boilers in the current period, leading to an increased proportion of coal-fired heating and higher cost expenditures[64](index=64&type=chunk) [(XI) Capital Expenditures](index=26&type=section&id=(XI)%20Capital%20Expenditures) The Group's capital expenditures significantly increased by 106.17% in H1 2025, primarily due to the purchase of coal-fired boilers from the controlling shareholder - For the six months ended June 30, 2025, the Group's capital expenditures were **RMB 124.03 million**, a year-on-year increase of **106.17%**[65](index=65&type=chunk) - The increase was mainly due to the Group's purchase of coal-fired boilers from the controlling shareholder in the current period, leading to increased capital expenditures[65](index=65&type=chunk) [(XII) Capital Structure](index=26&type=section&id=(XII)%20Capital%20Structure) As of June 30, 2025, the Group's owners' equity increased, total interest-bearing bank borrowings amounted to RMB 548 million, and cash and cash equivalents exceeded total interest-bearing liabilities - As of June 30, 2025, the Group's owners' equity was **RMB 1,150.06 million**, an increase of **RMB 106.90 million** compared to December 31, 2024[66](index=66&type=chunk) - Total interest-bearing bank and other borrowings amounted to approximately **RMB 548.00 million**, with fixed interest rates ranging from **3.2% to 3.9% per annum**[66](index=66&type=chunk) - As of June 30, 2025, the Group's cash and cash equivalents exceeded its total interest-bearing liabilities[66](index=66&type=chunk) [(XIII) Significant Acquisitions and Disposals](index=26&type=section&id=(XIII)%20Significant%20Acquisitions%20and%20Disposals) During the reporting period, the Group completed an acquisition of coal-fired boilers and other assets, and disclosed three proposed asset acquisitions related to the controlling shareholder group, all constituting connected and major transactions, but not yet completed - On January 15, 2025, the Company completed the acquisition of certain buildings, coal-fired boilers, and ancillary equipment from Changchun Heating Group for a consideration of **RMB 82,886,461.00**[67](index=67&type=chunk) - The Company proposes to acquire land, pipelines, machinery and equipment, and vehicles from Changchun Heating Group for a consideration of **RMB 113,930,021.65** (Proposed Acquisition I)[68](index=68&type=chunk) - Yatai Heating, a wholly-owned subsidiary of the Company, proposes to acquire machinery and equipment from Changchun Heating Group for a consideration of **RMB 16,457,865.00** (Proposed Acquisition II)[69](index=69&type=chunk) - The Company proposes to acquire machinery and equipment from Jilin Heating for a consideration of **RMB 475,980.76** (Proposed Acquisition III)[70](index=70&type=chunk) - The aforementioned proposed acquisitions all constitute connected transactions, and together with the previous acquisition, constitute major transactions for the Company, none of which were completed as of the announcement date[70](index=70&type=chunk)[71](index=71&type=chunk) [(XIV) Pledge of Assets](index=27&type=section&id=(XIV)%20Pledge%20of%20Assets) As of June 30, 2025, the Group had no pledged assets - As of June 30, 2025, the Group had no pledged assets[72](index=72&type=chunk) [(XV) Contingent Liabilities](index=27&type=section&id=(XV)%20Contingent%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[73](index=73&type=chunk) [III. Outlook for H2 2025](index=28&type=section&id=III.%20Outlook%20for%20H2%202025) This section outlines the Group's strategic priorities for the second half of 2025, focusing on core heating business, energy management, and project execution with safety [(I) Focus on Core Heating Business, Strengthen Service Foundation](index=28&type=section&id=(I)%20Focus%20on%20Core%20Heating%20Business%2C%20Strengthen%20Service%20Foundation) The Group will continue to deepen its core heating business in H2, ensuring stable heating operations, optimizing user services, proactively stocking coal for winter peak shaving, and improving the emergency response system - Continue to deepen the core heating business, comprehensively ensure stable operation of heating production, and continuously optimize user service processes and quality based on user needs[74](index=74&type=chunk) - Plan ahead and scientifically deploy winter peak-shaving coal reserves to ensure sufficient and stable coal supply[74](index=74&type=chunk) - Further improve the heating emergency response system to enhance the ability to respond to sudden heating failures[74](index=74&type=chunk) [(II) Strengthen Energy Management, Uncover Cost Reduction Potential](index=28&type=section&id=(II)%20Strengthen%20Energy%20Management%2C%20Uncover%20Cost%20Reduction%20Potential) The Group prioritizes energy management as key to improving efficiency, aiming to reduce energy consumption, enhance boiler efficiency, and achieve cost reduction through refined management, technological innovation, and real-time monitoring - Prioritize energy management as a key link to enhance corporate efficiency, effectively reduce energy consumption through refined management, technological innovation, and other means[75](index=75&type=chunk) - Strengthen real-time analysis and dynamic control of key indicators such as "water, electricity, heat, and coal"[75](index=75&type=chunk) - Increase efforts in equipment maintenance and technical transformation to improve boiler energy efficiency and achieve cost reduction targets[75](index=75&type=chunk) [(III) Accelerate Project Progress, Strictly Adhere to Safety Bottom Line](index=28&type=section&id=(III)%20Accelerate%20Project%20Progress%2C%20Strictly%20Adhere%20to%20Safety%20Bottom%20Line) The Group will accelerate key engineering project construction, optimize construction organization, and strictly implement safety production responsibility systems, strengthening risk control to achieve a zero-accident goal - Intensify efforts to advance key engineering construction, optimize construction organization, and ensure all projects are implemented smoothly as planned[76](index=76&type=chunk) - Strictly implement the safety production responsibility system, fully implementing "dual responsibilities for one position"[76](index=76&type=chunk) - Strengthen risk-based hierarchical control and hidden danger investigation and rectification, establish a normalized and institutionalized safety inspection mechanism to ensure the achievement of a zero-accident goal[76](index=76&type=chunk) [IV. Events After Reporting Period](index=29&type=section&id=IV.%20Events%20After%20Reporting%20Period) No significant events occurred after the reporting period other than those disclosed in this announcement - Except as disclosed in this announcement, there were no significant events after the reporting period[77](index=77&type=chunk) [Other Information](index=29&type=section&id=Other%20Information) This section covers additional information including interim dividends, corporate governance compliance, securities transactions, interim results review, and articles of association amendments [Interim Dividend](index=29&type=section&id=Interim%20Dividend) The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025 - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025[78](index=78&type=chunk) [Compliance with Corporate Governance Code](index=29&type=section&id=Compliance%20with%20Corporate%20Governance%20Code) The Company generally complied with the Corporate Governance Code during the reporting period, with the General Manager position briefly vacant before a new appointment restored compliance - The Company has complied with the code provisions set out in Appendix C1, Part 2 of the Listing Rules, "Corporate Governance Code," during the reporting period, except for a brief vacancy in the General Manager position[79](index=79&type=chunk) - Since April 16, 2025, Mr. Zhang Liming has been appointed as the General Manager of the Company, and the Company has re-complied with code provision C.2.1 of the Corporate Governance Code[79](index=79&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities or Redeemable Securities](index=29&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company%27s%20Listed%20Securities%20or%20Redeemable%20Securities) For the six months ended June 30, 2025, neither the Company nor its subsidiaries purchased, sold, or redeemed any of its listed or redeemable securities, nor did it hold any treasury shares - 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 or redeemable securities[80](index=80&type=chunk) - As of June 30, 2025, the Company did not hold any treasury shares[80](index=80&type=chunk) [Review of Interim Results](index=29&type=section&id=Review%20of%20Interim%20Results) The Company's Audit Committee and independent auditor have reviewed the interim results for the six months ended June 30, 2025, and agreed with the accounting treatments adopted - The Audit Committee comprises three members, with Mr. Chen Shenghui, an independent non-executive director, serving as Chairman[81](index=81&type=chunk) - The Company's Audit Committee and its independent auditor have reviewed the Group's interim results for the six months ended June 30, 2025, and agreed with the accounting treatments adopted by the Company[81](index=81&type=chunk) [Amendments to Articles of Association](index=30&type=section&id=Amendments%20to%20Articles%20of%20Association) The Company's Articles of Association were revised on May 16, 2025, with the latest version available on the company and HKEX websites - The Company's Articles of Association were revised at the 2024 Annual General Meeting held on May 16, 2025[82](index=82&type=chunk) - The latest version of the Articles of Association is also available on the Company's website and the HKEX website[82](index=82&type=chunk) [Definitions](index=30&type=section&id=Definitions) This section provides definitions for key terms used throughout the report, ensuring clarity and consistent understanding - This section provides definitions for key terms used in the report, including Articles of Association, Enterprise Accounting Standards, Board, China, Changchun Heating Group, the Company, Controlling Shareholder Group, Directors, the Group, Heating Service Area, Hong Kong, HKEX, Jilin Heating, Listing Rules, Reporting Period, RMB, Shares, Shareholders, Yatai Heating, and percentage symbol[83](index=83&type=chunk)[86](index=86&type=chunk)[84](index=84&type=chunk)[85](index=85&type=chunk)

[Interim Results Highlights](index=1&type=section&id=Interim%20Results%20Highlights) The company reported a slight revenue decrease, turning from profit to a HK$15 million loss attributable to owners, with no interim dividend [Financial Highlights](index=1&type=section&id=Financial%20Highlights) Revenue slightly decreased by 2% to HK$595 million, resulting in a HK$15 million loss attributable to owners and no interim dividend Financial Highlights for the Six Months Ended June 30, 2025 | Metric | June 30, 2025 (HK$ Thousand) | June 30, 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Revenue | 594,939 | 606,394 | | (Loss) / Profit Attributable to Owners of the Company | (15,035) | 2,460 | | (Loss) / Earnings Per Share (HK Cents) | (3.89) | 0.64 | | Interim Dividend Per Share | Nil | Nil | - Profit attributable to owners of the company turned from a profit of **HK$2.46 million** in the same period of 2024 to a loss of **HK$15.035 million** in the same period of 2025[3](index=3&type=chunk) [Condensed Consolidated Financial Statements](index=2&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents the condensed consolidated financial statements, including the statement of profit or loss and other comprehensive income, and the statement of financial position [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=2&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) Group revenue decreased by 2% to HK$595 million, turning to a HK$9.95 million loss due to higher expenses and reduced associate contributions Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (Summary) | Metric | June 30, 2025 (HK$ Thousand) | June 30, 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Revenue | 594,939 | 606,394 | | Cost of Sales | (419,799) | (434,355) | | Gross Profit | 175,140 | 172,039 | | Operating (Loss) / Profit | (4,247) | 7,953 | | Finance Costs | (5,085) | (989) | | (Loss) / Profit Before Tax | (1,560) | 11,091 | | (Loss) / Profit for the Period | (9,950) | 5,534 | | (Loss) / Profit Attributable to Owners of the Company | (15,035) | 2,460 | - Operating profit turned from **HK$7.953 million** in the same period of 2024 to an operating loss of **HK$4.247 million** in the same period of 2025[4](index=4&type=chunk) - Finance costs significantly increased by **414.7%** to **HK$5.085 million**, primarily due to higher interest on bank borrowings and lease liabilities[4](index=4&type=chunk)[16](index=16&type=chunk) [Condensed Consolidated Statement of Financial Position](index=4&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) Total assets less current liabilities increased to HK$778 million, with net assets rising to HK$628 million, driven by non-current asset growth and increased bank borrowings Condensed Consolidated Statement of Financial Position (Summary) | Metric | June 30, 2025 (HK$ Thousand) | December 31, 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Non-current Assets | 675,227 | 622,664 | | Current Assets | 773,769 | 773,149 | | Current Liabilities | 671,101 | 649,102 | | Net Current Assets | 102,668 | 124,047 | | Total Assets Less Current Liabilities | 777,895 | 746,711 | | Non-current Liabilities | 149,897 | 141,716 | | Net Assets | 627,998 | 604,995 | | Equity Attributable to Owners of the Company | 532,672 | 520,021 | | Total Equity | 627,998 | 604,995 | - Non-current assets increased by **8.4%** to **HK$675 million**, mainly due to increases in property, plant and equipment to **HK$447 million** and investments in associates to **HK$96.966 million**[6](index=6&type=chunk) - Net current assets decreased by **17.2%** to **HK$103 million**, primarily affected by increased inventories, decreased trade receivables, and higher bank borrowings within current liabilities[6](index=6&type=chunk) [Notes to the Condensed Consolidated Financial Statements](index=6&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) This section details the basis of preparation, application of new accounting standards, revenue segmentation, and specific financial item analyses [Basis of Preparation](index=6&type=section&id=Basis%20of%20Preparation) The condensed consolidated financial statements are prepared in accordance with HKAS 34 and Listing Rules, using consistent accounting policies as the 2024 annual financial statements - The condensed consolidated financial statements are prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" and applicable disclosure requirements of the Listing Rules[8](index=8&type=chunk) - The accounting policies and methods of computation adopted are consistent with those used in the annual financial statements for the year ended December 31, 2024[8](index=8&type=chunk) [New and Revised Hong Kong Financial Reporting Standards](index=6&type=section&id=New%20and%20Revised%20Hong%20Kong%20Financial%20Reporting%20Standards) The Group adopted HKAS 21 amendments without policy changes and is assessing HKFRS 18's impact on presentation, with no material effect on financial position - The Group first applied the amendments to Hong Kong Accounting Standard 21 "Lack of Exchangeability" from January 1, 2025, without changing accounting policies or making retrospective adjustments[9](index=9&type=chunk) - Hong Kong Financial Reporting Standard 18 "Presentation and Disclosure in Financial Statements" will be effective from January 1, 2027, introducing significant changes to the statement of profit or loss structure, disclosure of management-defined performance measures, and aggregation of information classification[10](index=10&type=chunk) - Amendments to Hong Kong Financial Reporting Standards 9 and 7 are not expected to have a significant impact on the Group's financial position and performance[12](index=12&type=chunk) [Application of Revised Hong Kong Financial Reporting Standards by the Group](index=6&type=section&id=Application%20of%20Revised%20Hong%20Kong%20Financial%20Reporting%20Standards%20by%20the%20Group) The Group adopted amendments to HKAS 21 from January 1, 2025, without any changes to accounting policies or retrospective adjustments - The Group first applied the amendments to Hong Kong Accounting Standard 21 "Lack of Exchangeability" from January 1, 2025[9](index=9&type=chunk) - The adoption of these revised standards did not result in changes to the Group's accounting policies or retrospective adjustments[9](index=9&type=chunk) [Impact of New and Revised Hong Kong Financial Reporting Standards Issued But Not Yet Adopted by the Group](index=6&type=section&id=Impact%20of%20New%20and%20Revised%20Hong%20Kong%20Financial%20Reporting%20Standards%20Issued%20But%20Not%20Yet%20Adopted%20by%20the%20Group) HKFRS 18, effective 2027, will significantly alter financial statement presentation and disclosure, while other amendments are not expected to have a material impact - Hong Kong Financial Reporting Standard 18 "Presentation and Disclosure in Financial Statements" will be effective from January 1, 2027, introducing significant changes to the statement of profit or loss structure, disclosure of management-defined performance measures, and aggregation of information classification[10](index=10&type=chunk) - Management is assessing the potential impact of applying Hong Kong Financial Reporting Standard 18 on the presentation and disclosure of the condensed consolidated financial statements[10](index=10&type=chunk) - Amendments to Hong Kong Financial Reporting Standards 9 and 7 are not expected to have a significant impact on the Group's financial position and performance[12](index=12&type=chunk) [Revenue and Segment Information](index=7&type=section&id=Revenue%20and%20Segment%20Information) Group revenue, segmented by market and division, slightly decreased overall, but saw growth in distribution and lens divisions, particularly in Asia - The Group's revenue is segmented by customer location into Europe, USA, Asia, and Other Regions, primarily selling optical products[13](index=13&type=chunk) Revenue and Results Analysis by Operating and Reportable Segment (Six Months Ended June 30, 2025) | Division/Region | Europe (HK$ Thousand) | USA (HK$ Thousand) | Asia (HK$ Thousand) | Other Regions (HK$ Thousand) | Total (HK$ Thousand) | | :--- | :--- | :--- | :--- | :--- | :--- | | Original Design Manufacturing Division | 184,777 | 87,659 | 106,439 | 392 | 379,267 | | Distribution Division | 95,502 | 10,906 | 21,078 | 16,685 | 144,171 | | Lens Division | 266 | – | 71,074 | 161 | 71,501 | | Revenue from External Customers | 280,545 | 98,565 | 198,591 | 17,238 | 594,939 | | Segment Profit | 14,691 | 1,942 | 1,650 | 2,216 | 20,499 | Revenue and Results Analysis by Operating and Reportable Segment (Six Months Ended June 30, 2024) | Division/Region | Europe (HK$ Thousand) | USA (HK$ Thousand) | Asia (HK$ Thousand) | Other Regions (HK$ Thousand) | Total (HK$ Thousand) | | :--- | :--- | :--- | :--- | :--- | :--- | | Original Design Manufacturing Division | 205,629 | 105,401 | 105,307 | 2,682 | 419,019 | | Distribution Division | 90,310 | 14,952 | 18,134 | 16,866 | 140,262 | | Lens Division | 59 | – | 47,054 | – | 47,113 | | Revenue from External Customers | 295,998 | 120,353 | 170,495 | 19,548 | 606,394 | | Segment Profit | 17,705 | 4,116 | 4,906 | 1,726 | 28,453 | [Finance Costs](index=8&type=section&id=Finance%20Costs) Group finance costs significantly increased to HK$5.085 million, primarily driven by higher interest on bank borrowings and lease liabilities Finance Costs | Item | June 30, 2025 (HK$ Thousand) | June 30, 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Interest on Bank Borrowings | 3,662 | 760 | | Interest on Lease Liabilities | 1,423 | 229 | | **Total** | **5,085** | **989** | - Finance costs increased by **414.7%** year-on-year, primarily driven by a **HK$2.902 million** increase in interest on bank borrowings and a **HK$1.194 million** increase in interest on lease liabilities[16](index=16&type=chunk) [Income Tax Expense](index=9&type=section&id=Income%20Tax%20Expense) Income tax expense rose to HK$8.39 million, influenced by increased taxes in Hong Kong and the UK, deferred tax, and under-provision for PRC corporate income tax Income Tax Expense | Item | June 30, 2025 (HK$ Thousand) | June 30, 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Hong Kong Profits Tax | 1,132 | 643 | | PRC Corporate Income Tax | 113 | 197 | | UK Corporate Tax | 2,193 | 2,073 | | South Africa Corporate Tax | 69 | 122 | | Italy Corporate Tax | 162 | 322 | | Deferred Tax | 4,185 | 2,174 | | **Total for the Period** | **7,854** | **5,531** | | Under-provision in Prior Periods (PRC Corporate Income Tax) | 536 | 20 | | **Total Income Tax Expense** | **8,390** | **5,557** | - Income tax expense increased by **50.98%** year-on-year to **HK$8.39 million**[17](index=17&type=chunk) - Hong Kong profits tax is levied at a two-tiered rate, with the first **HK$2 million** of assessable profits taxed at **8.25%** and the remainder at **16.5%**[17](index=17&type=chunk) [(Loss) / Profit for the Period](index=10&type=section&id=%EF%BC%88Loss%EF%BC%89%20%2F%20Profit%20for%20the%20Period) The Group recorded a loss of HK$9.95 million, primarily due to increased intangible asset amortization, inventory provisions, property, plant and equipment depreciation, and net exchange losses Key Items Affecting (Loss) / Profit for the Period | Item | June 30, 2025 (HK$ Thousand) | June 30, 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Amortisation of Intangible Assets | 1,346 | 2,231 | | Cost of Inventories | 409,691 | 438,376 | | Depreciation of Property, Plant and Equipment | 23,701 | 16,138 | | Decrease in Fair Value of Investment Properties | 1,100 | 4,000 | | Net Provision for / (Reversal of Provision for) Inventories | 10,108 | (4,021) | | Net Exchange Loss | 1,577 | 1,002 | - Net provision for inventories turned from a reversal of **HK$4.021 million** in the same period of 2024 to a provision of **HK$10.108 million** in the same period of 2025, negatively impacting profit[21](index=21&type=chunk) - Depreciation of property, plant and equipment increased by **46.8%** to **HK$23.701 million**[21](index=21&type=chunk) [Dividends](index=10&type=section&id=Dividends) The Board resolved not to declare an interim dividend for the six months ended June 30, 2025, consistent with the prior year - The Board resolved not to declare any interim dividend for the six months ended June 30, 2025, and June 30, 2024[22](index=22&type=chunk) - The final dividend for 2024 was nil, while the final dividend for 2023 was **5.0 HK cents** per share, amounting to **HK$19.313 million** paid[22](index=22&type=chunk) [(Loss) / Earnings Per Share](index=11&type=section&id=%EF%BC%88Loss%EF%BC%89%20%2F%20Earnings%20Per%20Share) Basic loss per share was 3.89 HK cents, compared to earnings per share of 0.64 HK cents in the prior period, reflecting the change in loss attributable to owners Basic (Loss) / Earnings Per Share | Metric | June 30, 2025 (HK$ Thousand) | June 30, 2024 (HK$ Thousand) | | :--- | :--- | :--- | | (Loss) / Profit for the Period Attributable to Owners of the Company | (15,035) | 2,460 | | Weighted Average Number of Shares | 386,263,374 | 386,263,374 | | Basic (Loss) / Earnings Per Share (HK Cents) | (3.89) | 0.64 | - Diluted (loss) / earnings per share is not presented as there were no outstanding potential ordinary shares in either period[23](index=23&type=chunk) [Trade and Other Receivables, Deposits and Prepayments](index=11&type=section&id=Trade%20and%20Other%20Receivables%2C%20Deposits%20and%20Prepayments) Total trade receivables decreased by 14% to HK$306 million, consistent with the revenue decline, with credit terms ranging from 30 to 150 days - The Group's trade receivables have credit terms ranging from **30 to 150 days**[24](index=24&type=chunk) Ageing Analysis of Trade Receivables | Ageing | June 30, 2025 (HK$ Thousand) | December 31, 2024 (HK$ Thousand) | | :--- | :--- | :--- | | 0 – 90 Days | 195,722 | 245,483 | | 91 – 180 Days | 93,184 | 99,562 | | Over 180 Days | 16,726 | 9,421 | | **Total** | **305,632** | **354,466** | - Total trade receivables decreased by **13.78%** from **HK$354 million** as of December 31, 2024, to **HK$306 million** as of June 30, 2025[24](index=24&type=chunk) [Trade and Other Payables and Accruals](index=12&type=section&id=Trade%20and%20Other%20Payables%20and%20Accruals) Total trade and other payables and accruals decreased to HK$509 million, with trade payables reducing to HK$137 million Trade and Other Payables and Accruals | Item | June 30, 2025 (HK$ Thousand) | December 31, 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Trade Payables | 136,815 | 173,490 | | Provision for Penalties | 19,383 | 19,359 | | Other Payables and Accruals | 353,315 | 351,931 | | **Total** | **509,513** | **544,780** | Ageing Analysis of Trade Payables | Ageing | June 30, 2025 (HK$ Thousand) | December 31, 2024 (HK$ Thousand) | | :--- | :--- | :--- | | 0 – 60 Days | 121,422 | 132,589 | | 61 – 120 Days | 7,159 | 36,308 | | Over 120 Days | 8,234 | 4,593 | | **Total** | **136,815** | **173,490** | - Total trade payables decreased by **21.14%** from **HK$173 million** as of December 31, 2024, to **HK$137 million** as of June 30, 2025[25](index=25&type=chunk) [Bank Borrowings](index=12&type=section&id=Bank%20Borrowings) Total secured bank borrowings increased to HK$216 million, with a significant rise in short-term borrowings, collateralized by investment properties and other assets Analysis of Bank Borrowings Repayment Schedule | Repayment Period | June 30, 2025 (HK$ Thousand) | December 31, 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Within One Year | 113,889 | 69,714 | | After One Year But Within Two Years | 22,371 | 14,116 | | After Two Years But Within Five Years | 66,426 | 68,538 | | After Five Years | 13,468 | 13,788 | | **Total** | **216,154** | **166,156** | - Total secured bank borrowings increased by **29.97%** from **HK$166 million** as of December 31, 2024, to **HK$216 million** as of June 30, 2025[25](index=25&type=chunk) - **HK$134.7 million** of bank borrowings are secured by the Group's investment properties, leasehold land and buildings, and construction in progress[26](index=26&type=chunk)[39](index=39&type=chunk) - The Group complied with its financial covenants for borrowing facilities for the six months ended June 30, 2025[27](index=27&type=chunk) [Management Discussion and Analysis](index=14&type=section&id=Management%20Discussion%20and%20Analysis) This section provides an in-depth analysis of the Group's financial performance, operational segments, liquidity, and future outlook [Dividends](index=14&type=section&id=Dividends) The Board decided not to declare an interim dividend for the six months ended June 30, 2025, consistent with the previous year - The Board resolved not to declare any interim dividend for the six months ended June 30, 2025[28](index=28&type=chunk) [Profitability Analysis](index=14&type=section&id=Profitability%20Analysis) Consolidated revenue slightly decreased by 2% to HK$594.9 million, leading to a HK$15 million loss attributable to owners, primarily due to US tariffs, rising operating costs, and increased finance costs Profitability Analysis Summary | Metric | H1 2025 (HK$ Thousand) | H1 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Consolidated Revenue | 594,900 | 606,400 | | (Loss) / Profit Attributable to Owners of the Company | (15,000) | 2,500 | | (Loss) / Earnings Per Share (HK Cents) | (3.89) | 0.64 | - The loss was primarily due to increased US tariffs disrupting global supply chains and rising operating costs[31](index=31&type=chunk) - Increased staff costs, promotion, and exhibition expenses resulted from the development of eyewear frame distribution and lens businesses in China and Southeast Asian markets[31](index=31&type=chunk) - Bank borrowing interest significantly increased by **HK$2.9 million** as the Group funded production bases outside China[31](index=31&type=chunk) [Original Design Manufacturing (ODM) Division](index=14&type=section&id=Original%20Design%20Manufacturing%20%28ODM%29%20Division) ODM division revenue decreased by 9% to HK$379.2 million, accounting for 64% of consolidated revenue, mainly due to increased US tariffs on China impacting shipments Original Design Manufacturing Division Revenue | Metric | H1 2025 (HK$ Thousand) | H1 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Revenue | 379,200 | 419,000 | | % of Consolidated Revenue | 64% | 69% | - Revenue decreased by **9%**, primarily because a significant increase in US tariffs on China in April 2025 led most US customers to suspend shipments until June 2025[30](index=30&type=chunk) - Sales of optical frames, sunglasses, and accessories accounted for **45%**, **49%**, and **6%** of ODM division revenue, respectively[30](index=30&type=chunk) [Distribution Division](index=14&type=section&id=Distribution%20Division) Distribution division revenue grew moderately by 3% to HK$144.2 million, representing 24% of consolidated revenue, with significant growth in Asia driven by marketing efforts Distribution Division Revenue | Metric | H1 2025 (HK$ Thousand) | H1 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Revenue | 144,200 | 140,300 | | % of Consolidated Revenue | 24% | 23% | - Asia sales significantly increased by **16%** compared to the same period last year, primarily from self-owned distributors in Hong Kong and Malaysia[32](index=32&type=chunk) - The German brand STEPPER remains the most popular brand in the distribution division[32](index=32&type=chunk) [Lens Division](index=15&type=section&id=Lens%20Division) Lens division revenue surged by 52% to HK$71.5 million, comprising 12% of consolidated revenue, driven by investments in production facilities in China and Malaysia Lens Division Revenue | Metric | H1 2025 (HK$ Thousand) | H1 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Revenue | 71,500 | 47,100 | | % of Consolidated Revenue | 12% | 8% | - Sales significantly increased by **52%**, primarily due to the Group's further investment in expanding its lens production facilities in China and Malaysia in the second half of 2024[33](index=33&type=chunk) - Currently, almost all revenue from the lens division is generated from Asia, and the Group plans to gradually expand its lens business to other regions[33](index=33&type=chunk) [Financial Position and Liquidity](index=15&type=section&id=Financial%20Position%20and%20Liquidity) The Group experienced a net cash outflow of HK$3.1 million from operations, with high capital expenditure and a deteriorating net cash position, though the current ratio remained stable - Net cash outflow from operating activities was **HK$3.1 million** (2024: inflow of **HK$28.2 million**), primarily due to the net loss recorded during the reporting period[34](index=34&type=chunk) - Capital expenditure amounted to **HK$31.4 million**, allocated to investment plans for the Malaysia optical lens production line and Vietnam factory expansion[34](index=34&type=chunk) - The net cash position (bank balances and cash less bank borrowings) decreased by **HK$47.5 million**, from a negative **HK$13.8 million** as of December 31, 2024, to a negative **HK$61.3 million** as of June 30, 2025[34](index=34&type=chunk) [Cash Flow](index=15&type=section&id=Cash%20Flow) The Group recorded a net cash outflow from operating activities of HK$3.1 million, with continued high capital expenditure and a deteriorating net cash position - The Group recorded a net cash outflow from operating activities of **HK$3.1 million**, compared to an inflow of **HK$28.2 million** in the same period last year[34](index=34&type=chunk) - Capital expenditure remained high at **HK$31.4 million**, primarily for investment plans in the Malaysia optical lens production line and Vietnam factory expansion[34](index=34&type=chunk) - The net cash position (bank balances and cash less bank borrowings) decreased by **HK$47.5 million**, from a negative **HK$13.8 million** as of December 31, 2024, to a negative **HK$61.3 million** as of June 30, 2025[34](index=34&type=chunk) [Working Capital Management](index=15&type=section&id=Working%20Capital%20Management) Inventory turnover increased due to suspended US shipments, trade receivables turnover slightly increased, while the current ratio remained stable at 1.2 - Inventory balance increased by **18%** to **HK$260.4 million**, and inventory turnover days increased from **71 days** to **113 days**, mainly due to suspended shipments to US customers[35](index=35&type=chunk) - Total trade receivables and bills receivable balance decreased by **14%** to **HK$305.8 million**, and trade receivables turnover days slightly increased from **91 days** to **94 days**[35](index=35&type=chunk) - The Group's current ratio remained stable at **1.2** as of June 30, 2025, and December 31, 2024[35](index=35&type=chunk) [Gearing Position](index=15&type=section&id=Gearing%20Position) The Group maintained a normal gearing position, with the debt-to-equity ratio slightly increasing to 28%, and non-current liabilities primarily comprising bank borrowings - The Group maintained a normal gearing position, with the debt-to-equity ratio slightly increasing from **27%** as of December 31, 2024, to **28%** as of June 30, 2025[36](index=36&type=chunk) - Non-current liabilities primarily include bank borrowings, amounting to **HK$102.3 million** as of June 30, 2025[36](index=36&type=chunk) [Net Assets](index=16&type=section&id=Net%20Assets) Equity attributable to owners of the company increased to HK$532.7 million, with net assets per share rising to HK$1.38, reflecting growth from the end of 2024 Net Assets Per Share | Metric | June 30, 2025 (HK$) | December 31, 2024 (HK$) | | :--- | :--- | :--- | | Equity Attributable to Owners of the Company | 532,700,000 | 520,000,000 | | Total Number of Issued Shares | 386,263,374 | 386,263,374 | | Net Assets Per Share | 1.38 | 1.35 | - Equity attributable to owners of the company was **HK$532.7 million** as of June 30, 2025, an increase from **HK$520 million** as of December 31, 2024[37](index=37&type=chunk) [Contingent Liabilities](index=16&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[38](index=38&type=chunk) [Pledge of the Group's Assets](index=16&type=section&id=Pledge%20of%20the%20Group%27s%20Assets) As of June 30, 2025, HK$134.7 million of the Group's bank borrowings were secured by investment properties, leasehold land and buildings, and construction in progress - **HK$134.7 million** of the Group's bank borrowings are secured by investment properties, leasehold land and buildings, and construction in progress[39](index=39&type=chunk) [Foreign Currency Risk](index=16&type=section&id=Foreign%20Currency%20Risk) The Group primarily faces RMB exchange rate fluctuations against USD and HKD, but manages this limited risk through close monitoring and forward contracts - The Group primarily faces the risk of fluctuations in the Renminbi against the US Dollar and Hong Kong Dollar[40](index=40&type=chunk) - As most transactions are conducted in US Dollars, Hong Kong Dollars, or Renminbi, the Group's exposure to foreign exchange fluctuation risk is limited[40](index=40&type=chunk) - The Group manages its foreign exchange risk by closely monitoring changes in foreign currency exchange rates and entering into forward contracts when appropriate[40](index=40&type=chunk) [Capital Structure and Financial Policy](index=16&type=section&id=Capital%20Structure%20and%20Financial%20Policy) Total shareholders' funds increased to HK$628 million, with financing primarily from internal cash flow and bank credit, guided by policies ensuring adequate resources and prudent risk management - The Group's total shareholders' funds amounted to **HK$628 million** as of June 30, 2025, an increase from **HK$605 million** as of December 31, 2024[41](index=41&type=chunk) - The Group generally funds its business operations through internally generated cash flows and credit facilities provided by its principal bankers in Hong Kong and Mainland China[41](index=41&type=chunk) - The Group's financial policy aims to ensure sufficient financial resources to support its business operations and investment activities while prudently and effectively managing financial risks[41](index=41&type=chunk) [Future Outlook and Other Information](index=17&type=section&id=Future%20Outlook%20and%20Other%20Information) This section outlines the market outlook, employee and remuneration policies, and significant events after the reporting period [Market Outlook](index=17&type=section&id=Market%20Outlook) The global economy faces trade volatility due to US tariffs, which the Group addresses through diversified production bases and strategic focus on the lens and smart eyewear sectors - The global economy is affected by US tariff measures, leading to volatile trade environments and widespread disruptions to global supply chains[42](index=42&type=chunk) - The Group has adopted a proactive strategy by establishing overseas production bases and flexibly allocating production capacity using its integrated global production network in China, Vietnam, and Malaysia[42](index=42&type=chunk) - The lens division and smart eyewear sector are considered strategic priorities for the Group's long-term development blueprint, with continuous strategic resource allocation to capture growth opportunities[42](index=42&type=chunk) [Employees and Remuneration Policy](index=17&type=section&id=Employees%20and%20Remuneration%20Policy) As of June 30, 2025, the Group employed approximately 3,400 full-time staff globally, with remuneration based on performance, experience, qualifications, and market levels, supplemented by various benefits - As of June 30, 2025, the Group employed approximately **3,400** full-time employees in Mainland China, Hong Kong, Europe, Southeast Asia, and South Africa (December 31, 2024: **3,600** employees)[43](index=43&type=chunk) - Remuneration is determined based on employee performance, experience, qualifications, and market salary levels, with discretionary performance bonuses[43](index=43&type=chunk) - Other employee benefits include insurance and medical coverage, subsidized education and training courses, and provident fund schemes[43](index=43&type=chunk) [Significant Events After the Reporting Period](index=17&type=section&id=Significant%20Events%20After%20the%20Reporting%20Period) No significant events impacting the Group occurred after the reporting period up to the date of this announcement, other than those already disclosed - Except for those disclosed in this announcement, no significant events affecting the Group occurred after the end of the reporting period and up to the date of this announcement[44](index=44&type=chunk) [Corporate Governance and Other Disclosures](index=17&type=section&id=Corporate%20Governance%20and%20Other%20Disclosures) This section covers the company's adherence to corporate governance codes, share transactions, review of interim results, publication details, and board composition [Corporate Governance](index=17&type=section&id=Corporate%20Governance) The company complied with the Listing Rules' Corporate Governance Code, with independent non-executive directors serving on key committees for oversight and advice - The Company has complied with all applicable code provisions set out in Part 2 of Appendix C1 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited's Corporate Governance Code throughout the reporting period[45](index=45&type=chunk) - The Company has an Audit Committee, Remuneration Committee, and Nomination Committee, all comprising independent non-executive directors, responsible for oversight and recommendations in their respective areas[45](index=45&type=chunk)[46](index=46&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=18&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company%27s%20Listed%20Securities) Neither the company nor its subsidiaries purchased, sold, or redeemed any listed securities during the reporting period, and no treasury shares were held - During the reporting period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[47](index=47&type=chunk) - As of June 30, 2025, the Company did not hold any treasury shares[47](index=47&type=chunk) [Review of Interim Results](index=18&type=section&id=Review%20of%20Interim%20Results) The Group's unaudited interim results and interim report were reviewed by the Audit Committee, which confirmed their preparation in accordance with applicable accounting standards and adequate disclosure - The Group's unaudited interim results and interim report for the reporting period have been reviewed by the Audit Committee[48](index=48&type=chunk) - The Audit Committee believes that the report has been prepared in accordance with applicable accounting standards and requirements, and that adequate disclosures have been made[48](index=48&type=chunk) [Publication of Interim Report](index=18&type=section&id=Publication%20of%20Interim%20Report) The 2025 Interim Report will be dispatched to shareholders in mid-September 2025 and published on the company's and HKEXnews websites - The 2025 Interim Report will be dispatched to the Company's shareholders in mid-September 2025[49](index=49&type=chunk) - The report will be published on the Company's website (www.artsgroup.com) and the HKEXnews website (www.hkexnews.hk)[49](index=49&type=chunk) [Directors](index=18&type=section&id=Directors) As of the announcement date, the Board of Directors comprises eight directors, including four executive directors and four independent non-executive directors - The Board of Directors comprises eight directors, including four executive directors: Mr. Ng Hoi Ying, Ms. Ng Yat Shan, Mr. Ng Kim Ying, and Ms. Ng Chi Hung[50](index=50&type=chunk) - The four independent non-executive directors are Mr. Wong Chak Wai, Mr. Chung Hiu Lam, Mr. Lam Yu Lung, and Dr. Fong Kin Chiu[50](index=50&type=chunk)

香港交易及結算所有限公司以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，並明確表示概不會就因本公告全部或任何部分內容而產生或因倚賴 該等內容而引致的任何損失承擔任何責任。 TAO HEUNG HOLDINGS LIMITED 稻 香 控 股 有 限 公 司 * （ 於開曼群島註冊成立的有限公司） （股份代號：573） 截至二零二五年六月三十日止六個月 未經審核中期業績公告 | 摘要 | | | | | | --- | --- | --- | --- | --- | | | 截至六月三十日止六個月 | | 減少 | | | | 二零二五年 | 二零二四年 | 百分比 | | | | （千港元） | （ 千港元） | | | | 收益 | 1,139,706 | 1,285,575 | (11.3 | %) | | 期內（虧損）╱溢利 | (35,775) | 9,430 | (479.4 | %) | | 本公司權益持有人應佔 | | | | | | （虧損）╱溢利 | (36,957) | 4,022 | (1,018.9 | %) | | | 港仙 | 港仙 | | ...

[Company's Major Financial Indicators](index=2&type=section&id=公司主要財務指標) This section presents the company's key financial performance indicators and accounting data for the reporting period [Major Accounting Data and Financial Indicators](index=2&type=section&id=一%E3%80%81公司主要會計數據和財務指標) For the six months ended June 30, 2025, the company's revenue decreased by 4.42% year-on-year, while net profit and total profit significantly declined by over 90%; net cash flow from operating activities increased by 125% year-on-year, and R&D investment as a percentage of operating revenue increased by 7.57 percentage points | Indicator | Jan-Jun 2025 (RMB thousands) | Jan-Jun 2024 (RMB thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 390,083 | 408,124 | -4.42 | | Profit/(Loss) before Income Tax | 5,622 | 72,187 | -92.21 | | Profit/(Loss) for the Period | 5,622 | 70,344 | -91.89 | | Net Profit Attributable to Shareholders of the Listed Company | 5,715 | 70,473 | -91.89 | | Net Cash Flow from Operating Activities | 62,212,859 | 27,649,549 | 125.00 | | Basic Earnings Per Share (RMB/share) | 0.01 | 0.07 | -85.71 | | R&D Investment as % of Operating Revenue | 45.63 | 38.06 | Increased by 7.57 percentage points | - Total profit and net profit attributable to shareholders of the listed company significantly decreased, primarily due to increased R&D expenses in the current period and compensation/liquidated damages recognized in the prior year from terminating cooperation with Shanghai Huizheng[9](index=9&type=chunk) - Net cash flow from operating activities increased, mainly due to the growth in cash received from sales of goods and provision of services during the reporting period[9](index=9&type=chunk) [Differences in Accounting Data under Domestic and Overseas Accounting Standards](index=5&type=section&id=二%E3%80%81境內外會計準則下會計數據差異) Since February 24, 2020, the company has prepared overseas financial statements in accordance with Chinese Enterprise Accounting Standards, thus there are no differences in accounting data under domestic and overseas accounting standards for this reporting period - Disclosure of differences in accounting data under domestic and overseas accounting standards is not applicable for this reporting period[10](index=10&type=chunk) [Non-recurring Gains and Losses Items and Amounts](index=5&type=section&id=三%E3%80%81非經常性損益項目和金額) During the reporting period, the company's total non-recurring gains and losses amounted to RMB 15,206,999, primarily from disposal gains/losses of non-current assets, government grants, and fair value changes/disposal gains/losses of financial assets and liabilities | Non-recurring Gains and Losses Item | Amount (RMB) | Notes (if applicable) | | :--- | :--- | :--- | | Disposal gains/losses of non-current assets | 203,055 | | | Government grants recognized in current profit or loss | 6,850,812 | | | Gains/losses from changes in fair value of financial assets and liabilities held by non-financial enterprises and gains/losses from disposal of financial assets and liabilities | 8,257,294 | Primarily interest or income from bank structured deposits and wealth management products | | Other non-operating income and expenses apart from the above | -103,860 | | | Less: Impact on minority interests (after tax) | 302 | | | Total | 15,206,999 | | [Management Discussion and Analysis](index=6&type=section&id=管理層討論與分析) This section provides a comprehensive review of the Group's financial performance, business operations, R&D strategies, core competencies, and risk factors [Financial Review for the Six Months Ended June 30, 2025](index=6&type=section&id=截至二零二五年六月三十日止六個月財務回顧) During the reporting period, the company's operating revenue decreased by 4% year-on-year, mainly due to reduced sales of its core product, Libaoduo®; operating costs increased due to higher per-unit production costs of Libaoduo® impacted by centralized procurement; selling expenses surged by 59%, while administrative expenses decreased by 13%; R&D expenses continued to grow by 15%; net profit significantly dropped by 92% year-on-year, primarily due to compensation and liquidated damages recognized in the prior year; the company maintains a stable financial position with no bank borrowings or asset pledges, actively managing cash through structured deposits [Operating Revenue](index=6&type=section&id=營業收入) For the six months ended June 30, 2025, the Group's operating revenue was approximately RMB 390,083 thousand, a 4% year-on-year decrease, primarily from sales of medical and diagnostic products | Indicator | Jan-Jun 2025 (RMB thousands) | Jan-Jun 2024 (RMB thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 390,083 | 408,124 | -4 | | Main Revenue Source | Sales of Medical and Diagnostic Products | Sales of Medical and Diagnostic Products | Largely consistent | [Revenue from Sales of Pharmaceutical and Diagnostic Products](index=6&type=section&id=銷售醫藥及診斷產品的收入) Revenue from sales of medical and diagnostic products was RMB 383,924 thousand, accounting for 98.42% of main business revenue, a 6% year-on-year decrease; Aile®, Libaoduo®, and Fumeida® were the main contributing products, accounting for 49%, 30%, and 20% respectively | Indicator | Jan-Jun 2025 (RMB thousands) | Jan-Jun 2024 (RMB thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue from Sales of Medical and Diagnostic Products | 383,924 | 408,113 | -6 | | Proportion of Main Business Revenue | 98.42% | - | - | | Aile® Contribution Ratio | 49% | - | - | | Libaoduo® Contribution Ratio | 30% | - | - | | Fumeida® Contribution Ratio | 20% | - | - | - The sales and promotion of Aile® and Fumeida®, two photodynamic products, are managed by the Group's sales team[14](index=14&type=chunk) [Operating Costs](index=6&type=section&id=營業成本) Cost of main business was RMB 39,774 thousand, a 35.29% year-on-year increase; the increase in operating costs was mainly due to higher per-unit production costs of Libaoduo® caused by reduced output due to centralized procurement; the proportion of main business cost to main business revenue rose to 10%, but the overall gross profit margin remained largely stable | Indicator | Jan-Jun 2025 (RMB thousands) | Jan-Jun 2024 (RMB thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Cost of Main Business | 39,774 | 29,400 | 35.29 | | Proportion of Operating Costs | 100.00% | - | - | | Cost of Main Business as % of Main Business Revenue | 10% | 7% | Increased by 3 percentage points | - The increase in operating costs was mainly due to Libaoduo® being affected by centralized procurement, leading to a decrease in output and an increase in per-unit production costs[15](index=15&type=chunk) [Selling and Administrative Expenses](index=6&type=section&id=銷售費用和管理費用) Selling expenses significantly increased by 59% year-on-year to RMB 181,910 thousand, primarily for marketing and academic promotion; administrative expenses decreased by 13% year-on-year to RMB 20,303 thousand, mainly due to lower salary expenses | Indicator | Jan-Jun 2025 (RMB thousands) | Jan-Jun 2024 (RMB thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Selling Expenses | 181,910 | 114,493 | 59 | | Administrative Expenses | 20,303 | 23,374 | -13 | - The increase in selling expenses mainly includes marketing and academic promotion fees, salary expenses, depreciation and amortization expenses, business entertainment expenses, and travel expenses[16](index=16&type=chunk) - The decrease in administrative expenses was mainly due to lower salary expenses in the current reporting period compared to the prior year[16](index=16&type=chunk) [Research and Development Expenses](index=7&type=section&id=研發費用) R&D expenses were RMB 177,976 thousand, a 15% year-on-year increase, mainly due to the steady progress of R&D projects; the company adopts a conservative capitalization policy for R&D projects, with most in-progress project expenditures recognized as expenses | Indicator | Jan-Jun 2025 (RMB thousands) | Jan-Jun 2024 (RMB thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | R&D Expenses | 177,976 | 154,593 | 15 | | Total R&D Investment | 177,976 | 155,330 | 15 | - The company adopts a relatively conservative and prudent capitalization policy for R&D projects, with most in-progress project expenditures recognized as expenses when incurred[17](index=17&type=chunk) [Net Finance Income](index=7&type=section&id=財務收入－淨額) Net finance income was approximately RMB 392 thousand, a 76.6% year-on-year decrease, primarily due to reduced interest income | Indicator | Jan-Jun 2025 (RMB thousands) | Jan-Jun 2024 (RMB thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Net Finance Income | 392 | 1,676 | -76.6 | - The decrease in finance income was mainly due to a reduction in interest income during the reporting period compared to the prior year[18](index=18&type=chunk) [Other Income](index=7&type=section&id=其他收益) Other income was RMB 8,746 thousand, a 59% year-on-year decrease, mainly due to a reduction in government grants recognized during the year | Indicator | Jan-Jun 2025 (RMB thousands) | Jan-Jun 2024 (RMB thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Other Income | 8,746 | 21,114 | -59 | - The decrease in other income was mainly due to a reduction in government grants recognized during the year[19](index=19&type=chunk) [Income Tax Expense](index=7&type=section&id=所得稅費用) The Group's main subsidiaries are recognized as high-tech enterprises, applying a preferential tax rate of 15%; Hong Kong subsidiary Fengyi Holdings is subject to Hong Kong profits tax, but no assessable profits were generated during the reporting period, thus no Hong Kong profits tax was accrued; applicable tax rates and policies remained unchanged from the prior year - The Company, Taizhou Fudan-Zhangjiang, and Shanghai Suyuan Biotechnology Co., Ltd. are all recognized as high-tech enterprises, applying a **15%** corporate income tax rate[20](index=20&type=chunk) - Fengyi (Hong Kong) Holdings Limited is subject to Hong Kong profits tax, but no estimated assessable profits were generated during the reporting period, thus no Hong Kong profits tax was accrued[20](index=20&type=chunk) - As of June 30, 2025, the relevant tax rates and tax policies applicable to the Group remained unchanged compared to the first half of 2024[21](index=21&type=chunk) [Net Profit and Net Profit Margin](index=7&type=section&id=淨利潤及淨利潤率) The Group's net profit was approximately RMB 5,622 thousand, a year-on-year decrease of about 92%; net profit margin declined from 17% in the prior year to 1%, primarily due to compensation and liquidated damages recognized in the prior year | Indicator | Jan-Jun 2025 (RMB thousands) | Jan-Jun 2024 (RMB thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Net Profit | 5,622 | 70,344 | -92 | | Net Profit Margin | 1% | 17% | Decreased by 16 percentage points | - The decrease in net profit margin was mainly due to the compensation and liquidated damages recognized by the Company in the prior year after terminating cooperation with Shanghai Huizheng[22](index=22&type=chunk) [Profit Attributable to Shareholders of the Company](index=8&type=section&id=本公司股東應佔年度利潤) Profit attributable to shareholders of the Company was approximately RMB 5,715 thousand, a 92% year-on-year decrease | Indicator | Jan-Jun 2025 (RMB thousands) | Jan-Jun 2024 (RMB thousands) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Profit Attributable to Shareholders of the Company | 5,715 | 70,473 | -92 | [Liquidity and Financial Resources](index=8&type=section&id=流動資金及財務資源) The Group's funds primarily originate from internal earnings, proceeds from listings, government grants, and commercial loans; as of June 30, 2025, cash and cash equivalents amounted to RMB 1,106,490,805; the company adopts a conservative financial policy, centrally managing funds and utilizing structured deposit products to enhance returns on idle capital - The Group's funds primarily originate from internal earnings, proceeds from listings, government grants, and commercial loans[24](index=24&type=chunk) | Indicator | Jun 30, 2025 (RMB) | Jun 30, 2024 (RMB) | | :--- | :--- | :--- | | Cash and Cash Equivalents | 1,106,490,805 | 1,222,481,006 | - The Group has no outstanding bank borrowings, and the debt-to-equity ratio is not applicable[24](index=24&type=chunk) - During the reporting period, the Group subscribed to structured deposit products to effectively utilize idle funds[25](index=25&type=chunk) [Bank Financing](index=8&type=section&id=銀行融資) As of June 30, 2025, the Group had no outstanding bank financing - As of June 30, 2025, the Group had no outstanding bank financing[27](index=27&type=chunk) [Foreign Exchange Risk](index=8&type=section&id=外匯風險) Most of the Group's transactions occur in the domestic market, and exchange rate fluctuations have no significant impact on operating results and financial position - Most of the Group's transactions occur in the domestic market, and exchange rate fluctuations will not have a significant impact on the Group's operating results and financial position[28](index=28&type=chunk) [Asset Pledges](index=8&type=section&id=資產抵押) As of June 30, 2025, the Group had no asset pledges - As of June 30, 2025, the Group had no asset pledges[29](index=29&type=chunk) [Future Plans for Material Investments or Capital Assets](index=9&type=section&id=重大投資或資本資產的未來計劃) As of June 30, 2025, the Group has no material future plans for capital expenditures - As of June 30, 2025, the Group has no material future plans for capital expenditures[30](index=30&type=chunk) [Dividends](index=9&type=section&id=股利) The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025 - The Company's Board of Directors does not recommend the payment of an interim dividend for the six months ended June 30, 2025[31](index=31&type=chunk) [Contingent Liabilities](index=9&type=section&id=或然事項) As of June 30, 2025, the directors did not identify any material contingent liabilities; the company holds a 39.5663% equity interest in Shanghai Handu Pharmaceutical Technology Co., Ltd., recording an investment loss of approximately RMB 2.132 million; additionally, the company holds equity instruments of TuHURA Biosciences, Inc., with a fair value of approximately RMB 5,747 - As of June 30, 2025, the Company's directors did not identify any material contingent liabilities[32](index=32&type=chunk) - The net carrying amount of the Group's long-term equity investments was **RMB 253,145 thousand**, of which the equity interest in Shanghai Handu Pharmaceutical Technology Co., Ltd. ("Handu Pharmaceutical") was approximately **RMB 221,739 thousand**, accounting for **8.72%** of the Group's total assets[33](index=33&type=chunk) - During the reporting period, an investment loss of approximately **RMB 2.132 million** was recorded for Handu Pharmaceutical[33](index=33&type=chunk) - The Group holds **360** ordinary shares of TuHURA Biosciences, Inc., with a fair value of approximately **RMB 5,747**[37](index=37&type=chunk) [Subscription of Wealth Management Products and Structured Deposits](index=11&type=section&id=認購理財產品及結構性存款產品) During the reporting period, the company subscribed to multiple structured deposit products totaling RMB 1 billion using its own idle funds and temporarily idle raised funds; all these products have matured and been redeemed, yielding a total return of approximately RMB 8.26 million, aiming to enhance capital returns while ensuring fund safety and liquidity - The Company entered into structured deposit product agreements with Pudong Development Bank, Ping An Bank, and Bank of China, subscribing to structured deposit products totaling **RMB 1 billion**[41](index=41&type=chunk) - The aforementioned structured deposit products have all matured and been redeemed, with the return range consistent with the disclosed range, showing no material deviation[42](index=42&type=chunk) - During the reporting period, the Group obtained total returns of approximately **RMB 8.26 million** from purchasing structured deposits and wealth management products[43](index=43&type=chunk) [Business Review](index=12&type=section&id=業務回顧) The Group focuses on innovative R&D, manufacturing, and marketing of biopharmaceuticals, strategically prioritizing photodynamic and antibody-drug conjugate (ADC) therapies; China's pharmaceutical industry policies support innovative drug development, with promising market prospects for dermatological and anti-tumor drugs; the company's core products, Aile®, Fumeida®, and Libaoduo®, hold advantages in their respective fields, with ongoing expansion of new indications and drug development; R&D investment continues to increase, but Libaoduo® faces price reduction risks due to centralized procurement; the company is committed to strengthening core technological advantages, enriching its product portfolio, and actively addressing market challenges [Description of the Company's Industry and Main Business during the Reporting Period](index=12&type=section&id=一%E3%80%81報告期內公司所屬行業及主營業務情況說明) The Group primarily engages in innovative R&D, manufacturing, and marketing of biopharmaceuticals, with a core focus on addressing unmet clinical needs and providing effective solutions; China's pharmaceutical industry is rapidly developing with policy support, and innovative drugs are protected by full-chain policies; the dermatological drug market continues to grow, with unmet needs in the treatment of condyloma acuminatum and port-wine stains; the anti-tumor drug market is vast, and liposomal doxorubicin and other cyclic anti-tumor drugs hold significant importance [Industry Overview of the Group](index=12&type=section&id=%EF%BC%88一%EF%BC%89本集團所處行業情況) China's pharmaceutical industry, as a strategic emerging industry, receives intensive national policy support emphasizing accelerated innovative drug development, optimized review and approval processes, and expanded payment channels; the dermatological drug market continues to grow, with a projected CAGR of 6.32% from 2024-2028; the anti-tumor drug market is enormous, with global oncology spending expected to reach $370 billion by 2027, and innovative formulations like liposomal doxorubicin offering significant advantages - National policies intensively support the development of innovative drugs, including the "Government Work Report," "Key Tasks for Deepening Medical and Healthcare System Reform in 2024" issued by the General Office of the State Council, and the "Implementation Plan for Full-Chain Support of Innovative Drug Development" approved by the State Council Executive Meeting[45](index=45&type=chunk) - China's dermatological drug market size is projected to grow from **RMB 2.779 billion** in 2024 to **RMB 3.551 billion** in 2028, with a compound annual growth rate of **6.32%**[47](index=47&type=chunk) - Global oncology spending is expected to reach **$370 billion** by 2027, and liposomal doxorubicin offers significant advantages over traditional doxorubicin, such as longer action time, lower cardiotoxicity, and better tumor targeting[49](index=49&type=chunk)[50](index=50&type=chunk) [Main Sales Products of the Group](index=15&type=section&id=%EF%BC%88二%EF%BC%89本集團主營業務收入主要來源於公司醫藥產品的銷售收入%EF%BC%8C本集團的主要銷售產品包括%EF%BC%9A) The Group's main business revenue primarily comes from the sales of Aile® (photodynamic drug for condyloma acuminatum), Fumeida® (photodynamic drug for port-wine stains), and Libaoduo® (long-circulating doxorubicin hydrochloride liposome injection); both Aile® and Fumeida® are global first-in-class drugs, filling therapeutic gaps in their respective fields and being included in clinical guidelines; Libaoduo®, as the first domestic generic of Doxil, offers advantages in improving efficacy and reducing toxicity - Aile® is the world's first photodynamic drug for condyloma acuminatum, significantly reducing recurrence rates, filling therapeutic gaps in special areas, and included in "Dermatology and Venereology" textbooks and clinical treatment guidelines[52](index=52&type=chunk)[53](index=53&type=chunk) - Fumeida® is the world's first photodynamic drug for port-wine stains, boasting significant advantages such as stable compound structure, low phototoxicity, rapid metabolism, short light avoidance period, high cure rate, low scar incidence, and low recurrence rate[53](index=53&type=chunk) - Libaoduo® is the first domestic generic of Doxil, utilizing stealth liposome technology, which offers advantages in tumor therapeutics such as improved efficacy, reduced cardiotoxicity, myelosuppression, and hair loss, and is included in multiple cancer diagnosis and treatment guidelines[55](index=55&type=chunk) [Discussion and Analysis of Operating Performance](index=16&type=section&id=二%E3%80%81經營情況的討論與分析) The Group adheres to innovation and R&D as its core, strategically focusing on photodynamic drugs and antibody-drug conjugates (ADCs); photodynamic drugs continue to expand new indications and compounds for skin diseases, precancerous lesions, and tumor visualization; the ADC drug R&D pipeline is progressing smoothly, with multiple projects entering clinical trial stages and commercial production capabilities already established; during the reporting period, core product sales revenue was affected by centralized procurement, leading to a price reduction for Libaoduo®, which is expected to adversely impact future sales revenue [Research Strategy and Review](index=16&type=section&id=%EF%BC%88一%EF%BC%89研究策略及回顧) The Group's R&D strategy focuses on photodynamic drugs and antibody-drug conjugates (ADCs); photodynamic drugs continue to advance clinical research for the treatment of condyloma acuminatum, port-wine stains, acne, cervical precancerous lesions, actinic keratosis, and intraoperative visualization diagnosis for glioblastoma, bladder cancer, and breast cancer; for ADC drugs, anti-Trop2, anti-Her2, and anti-DLL3 antibody-drug conjugates are all progressing through different stages of clinical research, and a linker-drug platform has been established - The Group's innovative R&D areas focus on photodynamic drugs for skin diseases and precancerous lesions, photodynamic drugs for intraoperative tumor visualization, antibody-drug conjugates for tumors, and other drugs with proprietary patents or technological barriers[57](index=57&type=chunk) - The photodynamic drug R&D pipeline primarily focuses on two directions: photodynamic therapy (PDT) and photodynamic diagnosis (PDD), including expanding clinical new indications for marketed drugs and developing new photosensitizing compounds and supporting medical devices[58](index=58&type=chunk) - The Aminolevulinic Acid Hydrochloride powder for the treatment of HPV-infected cervical precancerous lesions and moderate-to-severe acne has completed Phase II clinical trials, and Phase III studies will be initiated as soon as possible[62](index=62&type=chunk)[63](index=63&type=chunk) - The Aminolevulinic Acid Hydrochloride oral solution powder for intraoperative visualization of high-grade glioblastoma has completed enrollment for confirmatory clinical trials and will submit a marketing application as soon as possible[65](index=65&type=chunk) - The Phase I clinical trial application for FZ-P001 Sodium for injection (Class 1 new chemical drug) for intraoperative visualization of malignant lesions in cancer has been accepted[67](index=67&type=chunk) - Phase III clinical research for anti-Trop2 antibody-drug conjugate SN38 for triple-negative breast cancer is ongoing; ADC projects such as anti-Her2 antibody-drug conjugate BB05, anti-Trop2 antibody-drug conjugate BB05, and anti-DLL3 antibody-drug conjugate BB05 are all undergoing Phase I/II clinical research[70](index=70&type=chunk)[72](index=72&type=chunk) [Industrialization Operations and Review](index=21&type=section&id=%28二%29%20產業化運營及回顧) During the reporting period, the Group's operating revenue decreased by 4% year-on-year; Aile® sales revenue increased by 2% year-on-year, while Fumeida® decreased by 7%; Libaoduo® sales revenue decreased by 16% year-on-year due to centralized procurement, with market retail prices gradually lowering from May 1, 2025; Taizhou Fudan-Zhangjiang's ADC workshop has been completed and put into production, providing assurance for the industrialization of ADC projects; the company will strengthen the competitiveness of its own sales team and expand hospital and department access - During the reporting period, the Group's operating revenue decreased by **4%** compared to the prior year[75](index=75&type=chunk) | Product | YoY Change in Sales Revenue | | :--- | :--- | | Aile® | Increased by 2% | | Fumeida® | Decreased by 7% | | Libaoduo® | Decreased by 16% | - Libaoduo®'s market retail price was adjusted and gradually lowered from May 1, 2025, due to centralized procurement rules and changes in market competition[75](index=75&type=chunk) - Taizhou Fudan-Zhangjiang's newly built antibody-drug conjugate workshop has achieved commercial-scale mass production capability for the anti-Trop2 antibody-drug conjugate SN38 project and completed commercial production technology transfer and proposed Phase III clinical trial sample production for the anti-Her2 antibody-drug conjugate BB05 project[76](index=76&type=chunk) [Significant Changes in the Company's Operating Performance and Future Impact during the Reporting Period](index=23&type=section&id=%EF%BC%88三%EF%BC%89報告期內公司經營情況的重大變化%EF%BC%8C以及報告期內發生的對公司經營情況有重大影響和預計未來會有重大影響的事項) The company's anti-tumor drug Libaoduo® was not selected in the tenth batch of national centralized procurement, leading to adjustments in its sales strategy and pricing, with market retail prices decreasing by no less than 35% from May 1, 2025; this is expected to adversely impact the company's sales revenue for the 2025 fiscal year and subsequent periods, potentially leading to a risk of single-product losses - The Company's anti-tumor drug Libaoduo® was not selected in the tenth batch of national centralized procurement[80](index=80&type=chunk) - From May 1, 2025, Libaoduo®'s market retail price will be gradually lowered, with a reduction of no less than **35%**[80](index=80&type=chunk) - This price adjustment for Libaoduo® is expected to adversely impact the company's sales revenue for the 2025 fiscal year and subsequent periods[80](index=80&type=chunk) [Analysis of Core Competitiveness during the Reporting Period](index=24&type=section&id=三%E3%80%81報告期內核心競爭力分析) The company's core competitiveness lies in innovative drug R&D, technological platform advantages, industrial promotion, production quality control, and its management and technical teams; during the reporting period, multiple photodynamic and ADC R&D projects made progress, with some reaching international leading levels; the company possesses four major technology platforms: genetic engineering, photodynamic, nanotechnology, and oral solid preparations; R&D investment continues to grow, and multiple government grants and awards have been received [Core Competitiveness Analysis](index=24&type=section&id=%EF%BC%88一%EF%BC%89核心競爭力分析) The company uses unmet clinical needs and unique therapeutic effects as criteria for new drug R&D project initiation and evaluation, seeking balanced development between innovative generics and first-in-class drugs; core competencies include R&D innovation advantages in pipeline projects (e.g., Hemoporfin US Phase II clinical, multiple new indications for Aminolevulinic Acid Hydrochloride), technological platform advantages (genetic engineering, photodynamic, nanotechnology, oral solid preparations), academic promotion advantages, a stringent production quality control system, and a stable and youthful management and technical team - The Company adheres to satisfying unmet and unsatisfactory clinical treatment needs and demonstrating unique therapeutic effects as decisive factors for new drug R&D project initiation and evaluation[81](index=81&type=chunk) | R&D Area | Project Name | Proposed Indication | Progress Achieved | Comparison with Industry Technology Level | | :--- | :--- | :--- | :--- | :--- | | Photodynamic Drug R&D | Hemoporfin (F0026) | Port-wine Stains | US Phase II clinical study ongoing | International leading level: new compound, new indication | | Photodynamic Drug R&D | Aminolevulinic Acid Hydrochloride – CIN (F0005) | HPV-infected Cervical Lesions | Phase II clinical study completed | International leading level: new indication | | Photodynamic Drug R&D | Aminolevulinic Acid Hydrochloride – Acne (F0014) | Acne | Phase II clinical study completed | International leading level: new indication | | ADC Drug R&D | Anti-DLL3 Antibody-Drug Conjugate BB05 (F0041) | Tumor | Phase I clinical study ongoing | International leading level: new compound | - The Group insists on academic promotion as its primary marketing method, utilizing diverse online platform channels to form a mature network service system[83](index=83&type=chunk) - The Group adheres to Chinese cGMP standards and refers to US FDA and European EMA cGMP requirements to establish comprehensive production and quality management regulations and systems[85](index=85&type=chunk) [Events Seriously Affecting Core Competitiveness and Responses during the Reporting Period](index=26&type=section&id=%EF%BC%88二%EF%BC%89報告期內發生的導致公司核心競爭力受到嚴重影響的事件%E3%80%81影響分析及應對措施) During the reporting period, no events occurred that severely impacted the company's core competitiveness - Not applicable[86](index=86&type=chunk) [Core Technologies and R&D Progress](index=27&type=section&id=%EF%BC%88三%EF%BC%89核心技術與研發進展) The company has established four core technology platforms: genetic engineering, photodynamic, nanotechnology, and oral solid preparations, strategically focusing on photodynamic drugs and antibody-drug conjugates; during the reporting period, the clinical study of Aminolevulinic Acid Hydrochloride granules for adjuvant use in bladder cancer surgical resection completed its first patient enrollment, and the Phase I clinical trial application for FZ-P001 Sodium for injection for intraoperative visualization of malignant lesions in cancer was accepted; total R&D investment amounted to RMB 177,976,257, a 14.58% year-on-year increase, accounting for 45.63% of operating revenue; the number of R&D personnel was 155, and government grants and awards totaling approximately RMB 11.055 million were received - The Company has formed genetic engineering technology, photodynamic technology, nanotechnology, and oral solid preparation technology platforms, strategically focusing on photodynamic drugs and antibody-drug conjugates[87](index=87&type=chunk) - The Company's photodynamic technology is at a world-leading level, with marketed products covering two of the four categories: hematoporphyrin, aminolevulinic acid hydrochloride, verteporfin, and hemoporfin[87](index=87&type=chunk) - Nanoparticle formulation R&D presents technological barriers, and the Company has established a nanotechnology platform and successfully launched Libaoduo®[88](index=88&type=chunk)[89](index=89&type=chunk) - In March 2025, the confirmatory clinical study of Aminolevulinic Acid Hydrochloride granules for adjuvant use in surgical resection of non-muscle invasive bladder cancer completed its first subject enrollment[91](index=91&type=chunk) - In June 2025, the Phase I clinical trial application for FZ-P001 Sodium for injection for intraoperative visualization of malignant lesions in cancer was accepted[91](index=91&type=chunk) | Indicator | Jan-Jun 2025 (RMB) | Jan-Jun 2024 (RMB) | Change (%) | | :--- | :--- | :--- | :--- | | Expensed R&D Investment | 177,976,257 | 154,592,537 | 15.13 | | Capitalized R&D Investment | – | 737,612 | -100.00 | | Total R&D Investment | 177,976,257 | 155,330,149 | 14.58 | | Total R&D Investment as % of Operating Revenue | 45.63 | 38.06 | Increased by 7.57 percentage points | | Indicator | Jan-Jun 2025 | Jan-Jun 2024 | | :--- | :--- | :--- | | Number of Company R&D Personnel | 155 | 180 | | Proportion of R&D Personnel to Total Company Staff (%) | 17.24 | 19.72 | | Total R&D Personnel Remuneration (RMB) | 36,390,548 | 43,950,526 | | Average R&D Personnel Remuneration (RMB) | 234,778 | 244,170 | - During the reporting period, the Group received government grants and awards totaling approximately **RMB 11.055 million** for various R&D and industrialization projects[96](index=96&type=chunk) [Risk Factors](index=31&type=section&id=四%E3%80%81風險因素) The company faces risks associated with long R&D cycles, high costs, and uncertain outcomes for new drugs; loss of core technical personnel could impact technological leadership and sustained profitability; a relatively singular product portfolio means leading products are vulnerable to policy and market competition, potentially adversely affecting operations and financial performance; Libaoduo®'s non-selection in national centralized procurement led to a significant price reduction, with 2025 sales revenue projected to decrease by over 50% year-on-year, potentially resulting in single-product losses - New drug R&D to market launch can take ten years or more, is costly, and has significant uncertainty in outcomes[97](index=97&type=chunk) - The loss of core technical personnel could adversely affect the Company's core competitiveness and sustained profitability[98](index=98&type=chunk) - The Company's product portfolio is relatively singular, with leading products Aile®, Libaoduo®, and Fumeida® accounting for a large proportion of total sales revenue[99](index=99&type=chunk) - Libaoduo® was not selected in the tenth batch of national centralized procurement, leading to a price reduction of no less than **35%** in its market retail price, with 2025 sales revenue projected to decrease by over **50%** year-on-year, potentially resulting in single-product losses[102](index=102&type=chunk) [Outlook](index=33&type=section&id=前景) The Group will continue to uphold its biopharmaceutical development philosophy of innovative R&D, manufacturing, and marketing, strategically focusing on photodynamic technology and antibody-drug conjugates (ADCs); it will increase investment and rapidly advance R&D, registration, and industrialization to achieve a solid advantageous position in niche pharmaceutical markets and the capital market, aiming to become an innovator and leader in the biopharmaceutical industry - The Group will strategically focus on the photodynamic technology field, comprehensively developing from special devices to innovative drugs, rapidly advancing R&D, registration, and industrialization to achieve a comprehensive, long-term, absolute advantageous and leading position in this field[105](index=105&type=chunk) - The Group will rapidly advance the R&D and industrialization of antibody-drug conjugates (ADCs), actively participate in market competition, and expand industrial scale and capabilities[105](index=105&type=chunk) - The company will focus on strengthening and consolidating core technological advantages, enriching its product portfolio, promoting the industrialization of R&D achievements, and building a globally renowned photodynamic brand[79](index=79&type=chunk) [Corporate Governance, Environmental and Social Responsibility](index=34&type=section&id=公司治理%E3%80%81環境和社會責任) This section outlines the company's corporate governance practices, board and management changes, employee information, and social responsibility initiatives [Changes in Directors, Supervisors, Senior Management, and Core Technical Personnel](index=34&type=section&id=公司董事%E3%80%81監事%E3%80%81高級管理人員和核心技術人員變動情況) During the reporting period, there were no changes in the company's directors, supervisors, senior management, or core technical personnel - Not applicable[106](index=106&type=chunk) [Profit Distribution or Capital Reserve Conversion Plan](index=34&type=section&id=利潤分配或資本公積金轉增預案) The company's proposed semi-annual profit distribution plan is no distribution or capital reserve conversion | Whether to Distribute or Convert | No | | :--- | :--- | | Number of Bonus Shares per 10 Shares (shares) | Not applicable | | Dividend per 10 Shares (RMB) (tax inclusive) | Not applicable | | Number of Shares Converted from Capital Reserve per 10 Shares (shares) | Not applicable | [Status and Impact of Company's Equity Incentive Plans, Employee Stock Ownership Plans, or Other Employee Incentive Measures](index=34&type=section&id=公司股權激勵計劃%E3%80%81員工持股計劃或其他員工激勵措施的情況及其影響) For the six months ended June 30, 2025, the company had no existing effective incentive plans, employee stock ownership plans, or other incentive schemes - For the six months ended June 30, 2025, the Company had no existing effective incentive plans, employee stock ownership plans, or other incentive schemes[107](index=107&type=chunk) [Corporate Governance Practices](index=34&type=section&id=企業管治常規) The company has adopted the Corporate Governance Code in Appendix C1 of the Hong Kong Listing Rules; except for Code Provision C.2.1 (separation of Chairman and Chief Executive roles), the company has complied with the principles and code provisions set out in the Code during the reporting period; the company's directors have complied with the code of conduct for securities transactions - The Company has adopted the Corporate Governance Code in Appendix C1 of the Hong Kong Listing Rules[108](index=108&type=chunk) - Except for Code Provision C.2.1 (the roles of Chairman and Chief Executive should be separate), the principles and code provisions set out in the Code have been met during the reporting period[110](index=110&type=chunk) - Mr. Zhao Dajun serves as both Chairman and General Manager (Chief Executive), an arrangement the Board believes is more beneficial for the company's development at the current stage[111](index=111&type=chunk) - All directors confirmed compliance with the standards stipulated in the code of conduct during the reporting period[112](index=112&type=chunk) [Audit Committee](index=36&type=section&id=審核委員會) The company's Audit Committee is responsible for reviewing financial reports, internal controls, and corporate governance, and making recommendations to the Board; the committee comprises two independent non-executive directors and one non-executive director, with Mr. Lin Zhaorong serving as Chairman; the committee has reviewed the Group's unaudited interim results and report, deeming them compliant with applicable accounting standards and the Hong Kong Listing Rules - The Company's Audit Committee is responsible for auditing financial reports, reviewing internal controls and corporate governance, and making relevant recommendations to the Board[114](index=114&type=chunk) - The committee members consist of Mr. Lin Zhaorong (Chairman), Mr. Wang Hongguang (Independent Non-Executive Director), and Mr. Shen Bo (Non-Executive Director)[114](index=114&type=chunk) - The Audit Committee has reviewed the Group's unaudited interim results and report for the six months ended June 30, 2025, and believes they are prepared in compliance with applicable accounting standards and the Hong Kong Listing Rules, with sufficient disclosures made[114](index=114&type=chunk) [Independent Non-Executive Directors](index=36&type=section&id=獨立非執行董事) During the reporting period, the company fully complied with the Hong Kong Listing Rules regarding independent non-executive directors, and all independent non-executive directors confirmed their independence - During the reporting period, the Company fully complied with Rules 3.10(1), 3.10(2), and 3.21 of the Hong Kong Listing Rules regarding independent non-executive directors[115](index=115&type=chunk) [Independence of Independent Non-Executive Directors](index=36&type=section&id=獨立非執行董事的獨立性) In accordance with Listing Rule 3.13, each of the company's independent non-executive directors has confirmed their independence to the company, and the company considers them independent - In accordance with Listing Rule 3.13, each of the Company's independent non-executive directors has confirmed their independence to the Company. Based on the confirmation from the independent non-executive directors, the Company considers them independent[116](index=116&type=chunk) [Employees and Remuneration](index=36&type=section&id=僱員及薪酬) As of June 30, 2025, the Group had 899 employees, with staff costs of RMB 101,818,230, a 13.58% year-on-year decrease; the company offers competitive remuneration and benefits, adjusted based on market conditions and employee performance | Indicator | Jun 30, 2025 | Jun 30, 2024 | YoY Change (%) | | :--- | :--- | :--- | :--- | | Number of Employees | 899 | 913 | -1.53 | | Staff Costs (RMB) | 101,818,230 | 117,815,229 | -13.58 | - The Group provides competitive remuneration and benefits based on market conditions and employees' experience and qualifications, with performance-based compensation[117](index=117&type=chunk) [Purchase, Sale or Redemption of Listed Securities](index=36&type=section&id=購買%E3%80%81出售或贖回上市證券) For the six months ended June 30, 2025, neither the company nor its subsidiaries purchased, sold, or redeemed any of the company's listed securities, nor did they hold any treasury shares - For the six months ended June 30, 2025, neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's listed securities (including treasury shares)[118](index=118&type=chunk) [Environmental Information of Listed Companies and their Major Subsidiaries Included in the List of Enterprises Required to Disclose Environmental Information by Law](index=36&type=section&id=納入環境信息依法披露企業名單的上市公司及其主要子公司的環境信息情況) Not applicable - Not applicable[119](index=119&type=chunk) [Specific Progress in Consolidating and Expanding Poverty Alleviation Achievements, Rural Revitalization, etc.](index=36&type=section&id=鞏固拓展脫貧攻堅成果%E3%80%81鄉村振興等工作具體情況) During the reporting period, the company's labor union directly procured agricultural products totaling RMB 61,425 from farmers in impoverished mountainous areas of Rongjiang County, Guizhou, contributing to rural revitalization - During the reporting period, the Company's labor union directly procured agricultural products totaling **RMB 61,425** from farmers in impoverished mountainous areas of Rongjiang County, Guizhou, actively contributing to rural revitalization and supporting farmers[119](index=119&type=chunk) [Other Significant Matters](index=37&type=section&id=其他重要事項) This section covers various significant matters including commitment fulfillment, related party transactions, use of raised funds, and other material events [Fulfillment of Commitments](index=37&type=section&id=一%E3%80%81承諾事項履行情況) As of June 30, 2025, except for commitments already fulfilled, there were no changes in the commitments made by the company's shareholders, related parties, and the company itself, and all parties involved complied with the relevant disclosed commitments - As of June 30, 2025, except for commitments already fulfilled, the aforementioned commitments remained unchanged, and all parties involved complied with the relevant disclosed commitments[121](index=121&type=chunk) [Non-operating Fund Occupation by Controlling Shareholders and Other Related Parties during the Reporting Period](index=37&type=section&id=二%E3%80%81報告期內控股股東及其他關聯方非經營性佔用資金情況) Not applicable - Not applicable[122](index=122&type=chunk) [Irregular Guarantees](index=37&type=section&id=三%E3%80%81違規擔保情況) Not applicable - Not applicable[122](index=122&type=chunk) [Half-Year Report Audit Status](index=37&type=section&id=四%E3%80%81半年報審計情況) The financial information of the Group for the reporting period contained in this report has not been audited by the auditors - The financial information of the Group for the reporting period contained in this report has not been audited by the auditors[122](index=122&type=chunk) [Changes and Handling of Matters Related to Non-Standard Audit Opinions in the Previous Year's Annual Report](index=37&type=section&id=五%E3%80%81上年年度報告非標準審計意見涉及事項的變化及處理情況) Not applicable - Not applicable[123](index=123&type=chunk) [Matters Related to Bankruptcy Reorganization](index=37&type=section&id=六%E3%80%81破產重整相關事項) Not applicable - Not applicable[123](index=123&type=chunk) [Material Litigation and Arbitration Matters](index=37&type=section&id=七%E3%80%81重大訴訟%E3%80%81仲裁事項) During the reporting period, the Group had no material litigation or arbitration matters - During the reporting period, the Group had no material litigation or arbitration matters[123](index=123&type=chunk) [Listed Company and its Directors, Supervisors, Senior Management, Controlling Shareholders, Actual Controllers Suspected of Violations, Penalties, and Rectification](index=37&type=section&id=八%E3%80%81上市公司及其董事%E3%80%81監事%E3%80%81高級管理人員%E3%80%81控股股東%E3%80%81實際控制人涉嫌違法違規%E3%80%81受到處罰及整改情況) Not applicable - Not applicable[123](index=123&type=chunk) [Explanation of the Integrity Status of the Company, its Controlling Shareholders, and Actual Controllers during the Reporting Period](index=37&type=section&id=九%E3%80%81報告期內公司及其控股股東%E3%80%81實際控制人誠信狀況的說明) Not applicable - Not applicable[123](index=123&type=chunk) [Material Related Party Transactions](index=38&type=section&id=十%E3%80%81重大關聯%EF%BC%88連%EF%BC%89交易) The company has ongoing related party transactions with Shanghai Pharmaceuticals Holding Co., Ltd., primarily involving sales and distribution agreements - The company has ongoing related party transactions with Shanghai Pharmaceuticals Holding Co., Ltd., primarily involving sales and distribution agreements[124](index=124&type=chunk) [Explanation of Progress in Use of Raised Funds](index=38&type=section&id=十一%E3%80%81募集資金使用進展說明) The company's net proceeds from its A-share listing in 2020 amounted to RMB 974.3239 million; as of June 30, 2025, cumulative utilized raised funds totaled RMB 842.3589 million, with a remaining balance of RMB 186.9575 million; the Hemoporfin US registration project has been extended to December 31, 2025, due to external environmental factors; the company uses temporarily idle raised funds for cash management, not exceeding RMB 180 million - The Company completed its initial public offering of A-shares and listing on the STAR Market of the Shanghai Stock Exchange on June 19, 2020, with net proceeds of **RMB 974.3239 million**[125](index=125&type=chunk) | Planned Project | Budgeted Use Amount (RMB millions) | Amount Used in Reporting Period (RMB millions) | Cumulative Utilized Amount (RMB millions) | Balance as of Jun 30, 2025 (RMB millions) | | :--- | :--- | :--- | :--- | :--- | | Hemoporfin US Registration Project | 230.00 | 7.9428 | 67.5988 | 162.4012 | | Biopharmaceutical Innovation R&D and Sustainable Development Project | 240.00 | – | 240.00 | – | | Acquisition of Minority Equity in Taizhou Fudan-Zhangjiang Project | 180.00 | – | 180.00 | – | | Over-raised Funds | – | – | 324.3239 | – | | Interest on Raised Funds | – | – | 30.4362 | 24.5563 | | Total | 650.00 | 7.9428 | 842.3589 | 186.9575 | - The "Hemoporfin US Registration Project" implementation period has been adjusted to December 31, 2025, due to external environmental factors[129](index=129&type=chunk) - The Company agreed to use temporarily idle raised funds not exceeding **RMB 180 million** for cash management[127](index=127&type=chunk) [Explanation of Other Significant Matters](index=39&type=section&id=十二%E3%80%81其他重大事項的說明) As of June 30, 2025, and up to the publication date of this report, the company has no other significant matters - As of June 30, 2025, and up to the publication date of this report, the Company has no other significant matters[128](index=128&type=chunk) [Share Changes and Shareholder Information](index=40&type=section&id=股份變動及股東情況) This section details changes in the company's share capital, information on major shareholders, and shareholdings of directors, supervisors, and senior management [Changes in Share Capital](index=40&type=section&id=一%E3%80%81股本變動情況) During the reporting period, there were no changes in the company's total ordinary share capital or share capital structure - During the reporting period, there were no changes in the Company's total ordinary share capital or share capital structure[130](index=130&type=chunk) [Shareholder Information](index=40&type=section&id=二%E3%80%81股東情況) As of the end of the reporting period, the company had a total of 19,877 ordinary shareholders, comprising 19,737 A-share holders and 140 H-share holders; HKSCC NOMINEES LIMITED, Shanghai Pharmaceuticals Holding Co., Ltd., and Xinqi Phase II Venture Capital Enterprise were the top three shareholders; major shareholders Shanghai Industrial (Group) Co., Ltd. and Shanghai Pharmaceuticals collectively held 20.27% of the company's shares | Indicator | Quantity | | :--- | :--- | | Total Number of Ordinary Shareholders at Period End | 19,877 | | Of which: Number of A-share Shareholders | 19,737 | | Number of H-share Shareholders | 140 | | Shareholder Name | Shares Held at Period End (shares) | Percentage (%) | | :--- | :--- | :--- | | HKSCC NOMINEES LIMITED | 254,827,740 | 24.58 | | Shanghai Pharmaceuticals Holding Co., Ltd. | 210,142,560 | 20.27 | | Xinqi Phase II Venture Capital Enterprise | 156,892,912 | 15.14 | | Yang Zongmeng | 74,375,494 | 7.18 | | Wang Haibo | 56,099,327 | 5.41 | - Shanghai Industrial (Group) Co., Ltd. and Shanghai Pharmaceuticals collectively held **20.27%** of the company's shares[135](index=135&type=chunk) [Information on Directors, Supervisors, Senior Management, and Core Technical Personnel](index=42&type=section&id=三%E3%80%81董事%E3%80%81監事%E3%80%81高級管理人員和核心技術人員情況) During the reporting period, core technical personnel Wang Luochun's shareholding decreased by 452,625 shares; Directors Zhao Dajun, Xue Yan, and Supervisor Qu Yanan held company shares; the company has established and implemented the "Management System for Directors, Supervisors, and Senior Management Holding and Trading Company Shares," with no violations found during the reporting period | Name | Position | Shares Held at Beginning of Period (shares) | Shares Held at End of Period (shares) | Change in Shares (shares) | Reason for Change | | :--- | :--- | :--- | :--- | :--- | :--- | | Wang Luochun | Core Technical Personnel | 1,170,000 | 717,375 | -452,625 | Secondary market trading | | Name | Position | Share Class | Number of Shares Held (shares) | Percentage of Total Issued Shares | | :--- | :--- | :--- | :--- | :--- | | Zhao Dajun | Director | A-share | 15,620,710 | 1.51% | | Xue Yan | Director | A-share | 1,980,000 | 0.19% | | Xue Yan | Director | H-share | 50,000 | 0.00% | | Qu Yanan | Supervisor | A-share | 39,000 | 0.00% | - The Company has adopted the "Management System for Directors, Supervisors, and Senior Management Holding and Trading Company Shares"[139](index=139&type=chunk) - During the reporting period, all directors, supervisors, and relevant employees complied with the system, and no violations were found[140](index=140&type=chunk) [Consolidated Balance Sheet](index=44&type=section&id=合併資產負債表) As of June 30, 2025, the Group's total assets were RMB 2,541,453,272, a 1.74% decrease from the end of 2024; total current assets were RMB 1,593,438,095, and total non-current assets were RMB 948,015,177; total liabilities were RMB 261,015,209, a 7.19% decrease from the end of 2024; total equity attributable to parent company shareholders was RMB 2,279,821,312 | Indicator | Jun 30, 2025 (RMB) | Dec 31, 2024 (RMB) | Change (%) | | :--- | :--- | :--- | :--- | | Total Assets | 2,541,453,272 | 2,586,502,623 | -1.74 | | Total Current Assets | 1,593,438,095 | 1,606,778,507 | -0.83 | | Total Non-Current Assets | 948,015,177 | 979,724,116 | -3.24 | | Total Liabilities | 261,015,209 | 281,225,518 | -7.19 | | Total Equity Attributable to Parent Company Shareholders | 2,279,821,312 | 2,304,567,412 | -1.07 | [Company Balance Sheet](index=46&type=section&id=公司資產負債表) As of June 30, 2025, the Company's total assets were RMB 2,464,163,363, a 1.06% decrease from the end of 2024; total current assets were RMB 1,463,422,499, and total non-current assets were RMB 1,000,740,864; total liabilities were RMB 205,128,063, a 5.50% decrease from the end of 2024; total shareholders' equity was RMB 2,259,035,300 | Indicator | Jun 30, 2025 (RMB) | Dec 31, 2024 (RMB) | Change (%) | | :--- | :--- | :--- | :--- | | Total Assets | 2,464,163,363 | 2,490,546,568 | -1.06 | | Total Current Assets | 1,463,422,499 | 1,472,419,765 | -0.61 | | Total Non-Current Assets | 1,000,740,864 | 1,018,126,803 | -1.71 | | Total Liabilities | 205,128,063 | 217,064,267 | -5.50 | | Total Shareholders' Equity | 2,259,035,300 | 2,273,482,301 | -0.63 | [Consolidated Income Statement](index=48&type=section&id=合併利潤表) For the six months ended June 30, 2025, the Group achieved operating revenue of RMB 390,083,112, a 4.42% year-on-year decrease; net profit was RMB 5,622,200, a significant 92.01% year-on-year decrease; net profit attributable to parent company shareholders was RMB 5,715,142, a 91.89% year-on-year decrease; basic earnings per share were RMB 0.01 | Indicator | Jan-Jun 2025 (RMB) | Jan-Jun 2024 (RMB) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 390,083,112 | 408,123,863 | -4.42 | | Operating Profit | 5,726,060 | 72,223,824 | -92.07 | | Total Profit | 5,622,200 | 72,186,951 | -92.21 | | Net Profit | 5,622,200 | 70,344,013 | -92.01 | | Net Profit Attributable to Parent Company Shareholders | 5,715,142 | 70,473,064 | -91.89 | | Basic Earnings Per Share (RMB) | 0.01 | 0.07 | -85.71 | [Company Income Statement](index=50&type=section&id=公司利潤表) For the six months ended June 30, 2025, the Company achieved operating revenue of RMB 355,263,421, a 4.26% year-on-year increase; net profit was RMB 15,917,475, a 56.82% year-on-year decrease | Indicator | Jan-Jun 2025 (RMB) | Jan-Jun 2024 (RMB) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 355,263,421 | 340,740,051 | 4.26 | | Operating Profit | 15,955,880 | 37,165,160 | -57.07 | | Total Profit | 15,917,475 | 36,864,504 | -56.82 | | Net Profit | 15,917,475 | 36,864,504 | -56.82 | [Consolidated Cash Flow Statement](index=51&type=section&id=合併現金流量表) For the six months ended June 30, 2025, the Group's net cash flow from operating activities was RMB 62,212,859, a 125.00% year-on-year increase; net cash flow used in investing activities was RMB (8,277,485), compared to a net inflow in the prior year; net cash flow used in financing activities was RMB (3,638,269); the net increase in cash was RMB 50,205,176 | Indicator | Jan-Jun 2025 (RMB) | Jan-Jun 2024 (RMB) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 62,212,859 | 27,649,549 | 125.00 | | Net Cash Flow (Used in)/Generated from Investing Activities | (8,277,485) | 4,326,668 | -291.29 | | Net Cash Flow Used in Financing Activities | (3,638,269) | (5,522,836) | -34.13 | | Net Increase in Cash | 50,205,176 | 26,585,009 | 88.85 | | Cash Balance at Period End | 1,106,490,805 | 1,222,481,006 | -9.49 | [Company Cash Flow Statement](index=53&type=section&id=公司現金流量表) For the six months ended June 30, 2025, the Company's net cash flow from operating activities was RMB 53,254,422, compared to a net outflow in the prior year; net cash flow from investing activities was RMB 3,289,015, an 89.84% year-on-year decrease; net cash flow used in financing activities was RMB (3,638,269); the net increase in cash was RMB 52,905,168 | Indicator | Jan-Jun 2025 (RMB) | Jan-Jun 2024 (RMB) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Net Cash Flow Generated from/(Used in) Operating Activities | 53,254,422 | (1,236,887) | 4410.67 | | Net Cash Flow Generated from Investing Activities | 3,289,015 | 32,387,174 | -89.84 | | Net Cash Flow Used in Financing Activities | (3,638,269) | (5,489,073) | -33.71 | | Net Increase in Cash | 52,905,168 | 25,661,214 | 106.17 | | Cash Balance at Period End | 996,245,555 | 1,092,955,646 | -8.85 | [Consolidated Statement of Changes in Equity](index=55&type=section&id=合併股東權益變動表) For the six months ended June 30, 2025, the Group's total comprehensive income attributable to parent company shareholders was RMB 5,618,376, a significant 92.05% year-on-year decrease; retained earnings decreased by RMB 31,097,163 due to dividend distribution | Indicator | Jan-Jun 2025 (RMB) | Jan-Jun 2024 (RMB) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Net Profit Attributable to Parent Company Shareholders | 5,715,142 | 70,473,064 | -91.89 | | Total Comprehensive Income Attributable to Parent Company Shareholders | 5,618,376 | 70,613,805 | -92.05 | | Distribution to Shareholders | (31,097,163) | (72,560,047) | -57.00 | [Company Statement of Changes in Equity](index=57&type=section&id=公司股東權益變動表) For the six months ended June 30, 2025, the Company's net profit was RMB 15,917,475, a 56.82% year-on-year decrease; retained earnings decreased by RMB 31,097,163 due to dividend distribution | Indicator | Jan-Jun 2025 (RMB) | Jan-Jun 2024 (RMB) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Net Profit | 15,917,475 | 36,864,504 | -56.82 | | Distribution to Shareholders | (31,097,163) | (72,560,047) | -57.00 | [Notes to Financial Statements](index=58&type=section&id=財務報表附註) This section provides detailed explanations of the Group's significant accounting policies, estimates, tax information, and specific financial statement items [Company Information](index=58&type=section&id=一%20公司的基本情況) Shanghai Fudan-Zhangjiang Bio-Pharmaceutical Co., Ltd. was established in 1996, and after several capital changes, its registered capital and share capital amounted to RMB 103,657,210 as of May 11, 2023; the company primarily engages in innovative R&D, manufacturing, and marketing of biopharmaceuticals - Shanghai Fudan-Zhangjiang Bio-Pharmaceutical Co., Ltd. was established in the People's Republic of China on November 11, 1996[155](index=155&type=chunk) - As of May 11, 2023, the company's registered capital and share capital changed to **RMB 103,657,210**[158](index=158&type=chunk) - The Group's main business activities include researching, developing, and selling self-developed biopharmaceutical knowledge in China, providing contract research services to clients, manufacturing and selling pharmaceutical and diagnostic products, and offering other medical services[158](index=158&type=chunk) [Significant Accounting Policies and Estimates](index=59&type=section&id=二%20主要會計政策和會計估計) The Group's financial statements are prepared in accordance with "Enterprise Accounting Standards" and related regulations, on a going concern basis; key accounting policies and estimates include financial instrument classification and measurement, inventory valuation, fixed asset depreciation, intangible asset amortization, R&D expenditure capitalization, revenue recognition, government grants, deferred income tax assets and liabilities, and lease accounting; critical judgments and assumptions involve government grant recognition, expected credit loss measurement, and income tax and deferred income tax asset recognition - These financial statements are prepared in accordance with the "Enterprise Accounting Standards" issued by the Ministry of Finance and related regulations, on a going concern basis[163](index=163&type=chunk)[164](index=164&type=chunk) - The Group classifies financial assets into those measured at amortized cost, at fair value through other comprehensive income, and at fair value through profit or loss, based on the business model for managing financial assets and the characteristics of contractual cash flows[177](index=177&type=chunk) - Expenditures in the research phase are recognized as current period expenses when incurred; expenditures in the development phase are capitalized if they simultaneously meet the conditions of technical feasibility, management's intention, generation of economic benefits, resource support, and reliable measurement[212](index=212&type=chunk)[214](index=214&type=chunk) - The Group recognizes loss provisions for financial assets measured at amortized cost based on expected credit losses[181](index=181&type=chunk) - The Company and some subsidiaries are recognized as high-tech enterprises, calculating income tax at a preferential rate of **15%**, and it is assumed that high-tech enterprise recognition will continue in future years[241](index=241&type=chunk) [Taxation](index=73&type=section&id=三%20稅項) The Group primarily applies corporate income tax, value-added tax, and urban maintenance and construction tax; the company, Taizhou Pharmaceutical, and Suyuan Bio are all recognized as high-tech enterprises, applying a preferential corporate income tax rate of 15%; Fengyi Holdings is subject to Hong Kong profits tax, but no assessable profits were generated during the reporting period; the company and Taizhou Pharmaceutical, as advanced manufacturing enterprises, benefit from a VAT additional deduction policy | Tax Type | Tax Base | Tax Rate | | :--- | :--- | :--- | | Corporate Income Tax | Taxable Income | 15% and 16.5% | | Value-Added Tax | Taxable Value Added | 13%, 6%, and 3% | | Urban Maintenance and Construction Tax | Amount of VAT Paid | 5% and 7% | - The Company, Taizhou Fudan-Zhangjiang Pharmaceutical Co., Ltd., and Shanghai Suyuan Biotechnology Co., Ltd. are all recognized as high-tech enterprises, applying a **15%** corporate income tax rate[242](index=242&type=chunk)[243](index=243&type=chunk) - Fengyi (Hong Kong) Holdings Limited did not generate assessable profits during the reporting period, thus no Hong Kong profits tax was accrued[243](index=243&type=chunk) - The Company and Taizhou Pharmaceutical, as advanced manufacturing enterprises, enjoy an additional **5%** deduction on current deductible input VAT from January 1, 2023, to December 31, 2027, to reduce their VAT payable[244](index=244&type=chunk) [Notes to Consolidated Financial Statements](index=74&type=section&id=五%20合併財務報表附註) This section details the specific circumstances of each item in the consolidated financial statements; it covers the composition, changes, and impairment provisions for current assets and liabilities such as cash and bank balances, notes receivable, accounts receivable, other receivables, and inventories; non-current assets like long-term equity investments, fixed assets, intangible assets, and construction in progress are detailed regarding their carrying value, depreciation, amortization, and impairment; additionally, it itemizes various expenses (selling, administrative, R&D, finance), other income, investment income, credit and asset impairment losses, income tax expense, and the composition and reasons for changes in earnings per share; supplementary cash flo

[Management Discussion and Analysis](index=1&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) [Company Overview and Performance Summary](index=1&type=section&id=%E6%A6%82%E8%A7%88) Hang Fook Holdings primarily manufactures and trades apparel for international brands and invests in securities, with H1 2025 revenue down **69.0%** and gross profit down **89.7%**, leading to a significantly widened loss due to reduced orders, macroeconomic pressures, and idle facility costs - Core businesses include manufacturing and trading apparel products for international brands, utilizing the Heshan facility and engaging overseas subcontractors. The securities investment business involves trading listed securities on the Hong Kong Stock Exchange, adopting a conservative investment strategy during the review period[4](index=4&type=chunk) Key Financial Data for H1 2025 (Consolidated Statement) | Metric | H1 2025 (million HKD) | H1 2024 (million HKD) | YoY Change | | :--- | :--- | :--- | :--- | | Revenue | 86.9 | 280.8 | **-69.0%** | | Gross Profit | 3.3 | 32.1 | **-89.7%** | | Gross Margin | **3.8%** | **11.4%** | **-7.6 ppt** | | Loss for the Period | **(29.7)** | **(12.2)** | **143.4% (loss widened)** | | Loss Per Share (HK cents) | **(3.30)** | **(1.35)** | **144.4% (loss widened)** | - Key reasons for reduced revenue and gross profit include a significant decrease in orders from major US and European customers (due to changes in customer purchasing strategies and macroeconomic headwinds); a decline in gross margin (due to continuous inflationary pressure on supply chain and subcontractor pricing, and reduced sales volume of higher-margin children's wear); and the impact of idle costs at the Heshan facility (which has had no further production orders since completing existing orders in May 2024)[5](index=5&type=chunk)[6](index=6&type=chunk) [Market and Business Review](index=2&type=section&id=%E5%B8%82%E5%A0%B4%E5%8F%8A%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7) This section reviews the performance of the Group's two business segments, with the Garment Manufacturing and Trading segment experiencing significant decline and shifting to overseas subcontracting, while the Securities Investment segment maintained a cautious strategy with no trading activities [Garment Manufacturing and Trading Segment](index=2&type=section&id=%E6%88%90%E8%A1%A3%E8%A3%BD%E9%80%A0%E5%8F%8A%E8%B2%BF%E6%98%93%E5%88%86%E9%83%A8) The Garment Manufacturing and Trading segment faced macroeconomic challenges in H1 2025, with revenue down **69.0%** to **HKD 86.9 million** and loss up to **HKD 22.7 million**, shifting production to overseas subcontractors after Heshan facility cessation - Market challenges: The garment manufacturing industry faces macroeconomic challenges such as weak consumer demand, rising costs, and cautious inventory strategies by global retailers[7](index=7&type=chunk) Garment Manufacturing and Trading Segment Revenue and Loss | Metric | H1 2025 (million HKD) | H1 2024 (million HKD) | | :--- | :--- | :--- | | Revenue | 86.9 | 280.8 | | Loss | **(22.7)** | **(3.4)** | - Production strategy adjustment: The Heshan facility ceased production in May 2024, with all production orders reallocated to subcontracting partners in Cambodia and Indonesia, while the Heshan facility retains administrative and sample-making functions[8](index=8&type=chunk) [Securities Investment Segment](index=2&type=section&id=%E8%AD%89%E5%88%B8%E6%8A%95%E8%B3%87%E5%88%86%E9%83%A8) Given global market volatility and stagnant past performance, the Securities Investment segment maintained a cautious and conservative approach in H1 2025, holding or trading no listed securities during the period, and thus recording no fair value changes - Investment strategy: A cautious and conservative approach was maintained in H1 2025 due to global market volatility and stagnant past performance[9](index=9&type=chunk) - Trading activities and fair value changes: No listed securities were held or traded during the period, and no fair value changes were recorded (2024: nil)[9](index=9&type=chunk) [Financial Review](index=3&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) This section details the Group's financial performance, including expense changes, liquidity, capital expenditure, foreign exchange risk management, credit policy, asset pledges, and contingent liabilities, reflecting prudent financial management and a one-off restructuring for Heshan facility cessation [Administrative and Other Operating Expenses](index=3&type=section&id=%E8%A1%8C%E6%94%BF%E5%8F%8A%E5%85%B6%E4%BB%96%E7%87%9F%E9%81%8B%E9%96%8B%E6%94%AF) Administrative and other operating expenses decreased by **13.7%** to **HKD 30.3 million**, primarily because a one-off restructuring cost of approximately **HKD 3.9 million** related to the Heshan facility's production cessation in 2024 did not recur in 2025 Administrative and Other Operating Expenses | Metric | H1 2025 (million HKD) | H1 2024 (million HKD) | YoY Change | | :--- | :--- | :--- | :--- | | Expenses | **30.3** | **35.2** | **-13.7%** | - Main reason: A one-off restructuring cost of approximately **HKD 3.9 million** related to the Heshan facility's production cessation in 2024 was not incurred in 2025[10](index=10&type=chunk) [Selling and Distribution Expenses](index=3&type=section&id=%E9%8A%B7%E5%94%AE%E5%8F%8A%E5%88%86%E9%8A%B7%E9%96%8B%E6%94%AF) Selling and distribution expenses as a percentage of garment manufacturing and trading revenue increased to **2.2%**, primarily due to higher logistics costs from placing more production orders with overseas subcontractors and increased sample development fees to secure additional orders Selling and Distribution Expenses as a Percentage of Revenue | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Percentage | **2.2%** | **1.9%** | - Main reasons: Higher logistics costs from placing more production orders with overseas subcontractors, and increased sample development fees to secure additional orders[11](index=11&type=chunk) [Finance Costs](index=3&type=section&id=%E8%9E%8D%E8%B3%87%E9%96%8B%E6%94%AF) Finance costs significantly decreased by **76.2%** to approximately **HKD 1.2 million**, primarily due to the repayment of bank borrowings in 2024 Finance Costs | Metric | H1 2025 (million HKD) | H1 2024 (million HKD) | YoY Change | | :--- | :--- | :--- | :--- | | Expenses | **1.2** | **5.1** | **-76.2%** | - Main reason: Repayment of bank borrowings in 2024[12](index=12&type=chunk) [Net Other Income, Gains and Losses](index=3&type=section&id=%E5%85%B6%E4%BB%96%E6%94%B6%E5%85%A5%E3%80%81%E6%94%B6%E7%9B%8A%E5%8F%8A%E8%99%A7%E6%90%8D%E6%B7%A8%E9%A1%8D) Net other income, gains and losses amounted to approximately **HKD 5 thousand**, a significant decrease from **HKD 0.7 million** in H1 2024, primarily derived from compensation for customer order cancellations Net Other Income, Gains and Losses | Metric | H1 2025 (thousand HKD) | H1 2024 (thousand HKD) | | :--- | :--- | :--- | | Net Amount | **5** | **700** | - Main source: Compensation for customer order cancellations[13](index=13&type=chunk) [Treasury Policy, Liquidity and Financial Resources](index=3&type=section&id=%E5%BA%AB%E5%8B%99%E6%94%BF%E7%AD%96%E3%80%81%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E5%8F%8A%E8%B2%A1%E5%8B%99%E8%B3%87%E6%BA%90) The Group maintains a prudent financial management approach and a healthy financial position, with cash and bank balances of **HKD 88.2 million**, working capital of **HKD 83.2 million**, and a current ratio of **2.2** as of June 30, 2025, and the Heshan subsidiary received an unsecured, interest-free short-term loan of **HKD 47.8 million** from a director - Financial position: Maintains prudent financial management and a healthy financial position[14](index=14&type=chunk) Liquidity Indicators | Metric | June 30, 2025 (million HKD) | December 31, 2024 (million HKD) | | :--- | :--- | :--- | | Cash and Bank Balances | **88.2** | **111.0** | | Working Capital | **83.2** | **106.2** | | Current Ratio | **2.2** | **2.5** | - Subsidiary loan: A director advanced a short-term loan of **HKD 47.8 million** to the Heshan subsidiary, which is unsecured, interest-free, and has no fixed repayment terms[14](index=14&type=chunk) [Capital Expenditure](index=4&type=section&id=%E8%B3%87%E6%9C%AC%E9%96%8B%E6%94%AF) During the review period, the Group's total capital expenditure was **HKD 0.3 million**, a significant decrease from **HKD 2.1 million** in 2024, primarily related to the replacement of office equipment Capital Expenditure | Metric | H1 2025 (million HKD) | H1 2024 (million HKD) | | :--- | :--- | :--- | | Total Amount | **0.3** | **2.1** | - Main use: Replacement of office equipment[15](index=15&type=chunk) [Foreign Exchange Risk](index=4&type=section&id=%E5%A4%96%E5%8C%AF%E9%A2%A8%E9%9A%AA) The Group's sales are primarily transacted in USD, while operating expenses are mainly settled in HKD, RMB, and USD, resulting in low USD foreign exchange risk due to the HKD's peg to the USD, and the Group will closely monitor other foreign currency fluctuations and enter into foreign currency forward contracts when necessary to mitigate risks - Transaction currencies: Sales are primarily transacted in USD, while operating expenses are mainly settled in HKD, RMB, and USD[16](index=16&type=chunk) - Risk management: HKD is pegged to USD, resulting in lower USD foreign exchange risk; other foreign currency fluctuations will be closely monitored, and foreign currency forward contracts will be entered into when necessary[16](index=16&type=chunk) [Credit Policy](index=4&type=section&id=%E4%BF%A1%E8%B2%B8%E6%94%BF%E7%AD%96) The Group conducts business transactions with long-term stable customers on an open account basis, regularly reviews customer credit ratings, and adjusts credit limits as necessary - Credit period: Customers are granted credit periods ranging from **30 to 90 days**[44](index=44&type=chunk) - Management: Customer credit ratings are regularly reviewed, and credit limits are adjusted as necessary[17](index=17&type=chunk) [Pledge of Assets](index=4&type=section&id=%E8%B3%87%E7%94%A2%E6%8A%B5%E6%8A%BC) As of June 30, 2025, the Group had no pledged assets, following the full release on January 21, 2025, of Heshan land use rights and buildings previously pledged as collateral for a subsidiary director's loan on December 31, 2024 - June 30, 2025: No assets were pledged[18](index=18&type=chunk) - Historical situation: On December 31, 2024, Heshan land use rights (**HKD 7.2 million**) and buildings (**HKD 37.3 million**) were pledged as collateral for a subsidiary director's loan, which was fully released on January 21, 2025[18](index=18&type=chunk) [Contingent Liabilities](index=4&type=section&id=%E6%88%96%E7%84%B6%E8%B2%A0%E5%82%B5) As of June 30, 2025, and December 31, 2024, the Group had no contingent liabilities - Contingent liabilities: As of June 30, 2025, and December 31, 2024, the Group had no contingent liabilities[20](index=20&type=chunk) [Human Resources and Remuneration Policy](index=5&type=section&id=%E4%BA%BA%E5%8A%9B%E8%B3%87%E6%BA%90%E5%8F%8A%E8%96%AA%E9%85%AC%E6%94%BF%E7%AD%96) The Group is committed to providing a harmonious work environment, enhancing employee professional skills through training, and determining remuneration based on market practices, individual experience, and performance, with discretionary bonuses to attract and retain talent, resulting in a decrease in full-time employees to **185** as of June 30, 2025, due to streamlining Heshan facility operations - Employee development: Provides a harmonious work environment, valuable career opportunities, and professional skills training programs[21](index=21&type=chunk) - Remuneration: Determined based on market practices, individual experience, and performance, with discretionary bonuses awarded[21](index=21&type=chunk) Number of Full-time Employees | Date | Number of Employees | | :--- | :--- | | June 30, 2025 | **185** | | December 31, 2024 | **213** | Reason for decrease: Streamlining of Heshan facility operations [Environmental, Social and Governance (ESG) Responsibility](index=5&type=section&id=%E7%92%B0%E5%A2%83%E3%80%81%E7%A4%BE%E6%9C%83%E5%8F%8A%E4%BC%81%E6%A5%AD%E8%B2%AC%E4%BB%BB) The Group is committed to maintaining high ESG standards, with the Board assuming overall responsibility for effective risk management and internal control systems, and the management team overseeing ESG strategy implementation, risk alerts, and reporting to the Board, while complying with all relevant laws and regulations and encouraging stakeholder participation in environmental and social activities - ESG commitment: Committed to maintaining the highest standards of environmental and social responsibility to ensure business sustainability[22](index=22&type=chunk) - Board responsibilities: Assumes overall responsibility for ESG strategy, ensuring effective risk management and internal control systems[22](index=22&type=chunk) - Compliance: For the six months ended June 30, 2025, the Group complied with all relevant environmental and social laws and regulations related to its business operations[23](index=23&type=chunk) [Business Outlook](index=5&type=section&id=%E5%89%8D%E6%99%AF) The global economic outlook remains uncertain, affected by geopolitical tensions, currency fluctuations, and weak consumer sentiment, particularly in the US and European markets, with US tariffs on imported goods introducing uncertainty, prompting the Group to remain cautious, monitor market developments, and continue strategic initiatives including transitioning to Southeast Asian subcontracting and investing in automation and sustainability - Macroeconomic challenges: The global economic outlook is uncertain, affected by geopolitical tensions, currency fluctuations, and weak consumer sentiment in the US and European markets[24](index=24&type=chunk) - Trade policy impact: US tariffs on imported goods create uncertainty, potentially affecting sourcing preferences, cost competitiveness, and order flow[25](index=25&type=chunk) - Strategic responses: Transitioning to Southeast Asian subcontracting to enhance cost flexibility and geographical diversification; evaluating potential opportunities to invest in proprietary facilities in ASEAN countries; continuously investing in automation, production tracking, and sustainability programs to enhance competitiveness[25](index=25&type=chunk)[26](index=26&type=chunk) [Dividend Policy](index=6&type=section&id=%E4%B8%AD%E6%9C%9F%E8%82%A1%E6%81%AF) The Board resolved not to declare an interim dividend for the six months ended June 30, 2025 - Interim dividend: The Board resolved not to declare an interim dividend for the six months ended June 30, 2025 (2024: nil)[27](index=27&type=chunk)[47](index=47&type=chunk) [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) [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=7&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%E5%85%A5%E8%A1%A8) For the six months ended June 30, 2025, the Group recorded revenue of **HKD 86,947 thousand**, gross profit of **HKD 3,349 thousand**, loss for the period of **HKD 29,737 thousand**, and basic and diluted loss per share of **3.30 HK cents** Summary of Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income | Metric | H1 2025 (thousand HKD) | H1 2024 (thousand HKD) | | :--- | :--- | :--- | | Revenue | **86,947** | **280,835** | | Cost of Sales | **(83,598)** | **(248,697)** | | Gross Profit | **3,349** | **32,138** | | Loss Before Tax | **(29,737)** | **(12,168)** | | Loss for the Period | **(29,737)** | **(12,168)** | | Loss Per Share (HK cents) | **(3.30)** | **(1.35)** | [Condensed Consolidated Statement of Financial Position](index=8&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 non-current assets were **HKD 54,547 thousand**, current assets were **HKD 154,828 thousand**, current liabilities were **HKD 71,580 thousand**, and net assets were **HKD 117,924 thousand** Summary of Condensed Consolidated Statement of Financial Position | Metric | June 30, 2025 (thousand HKD) | December 31, 2024 (thousand HKD) | | :--- | :--- | :--- | | Non-current Assets | **54,547** | **60,402** | | Current Assets | **154,828** | **179,157** | | Current Liabilities | **71,580** | **72,921** | | Net Current Assets | **83,248** | **106,236** | | Net Assets | **117,924** | **147,923** | | Total Equity | **117,924** | **147,923** | [Notes to the Condensed Consolidated Financial Statements](index=10&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) [Basis of Preparation and Principal Accounting Policies](index=10&type=section&id=1.%20%E7%B7%A8%E8%A3%BD%E5%9F%BA%E6%BA%96) The condensed consolidated financial statements are prepared in accordance with Hong Kong Accounting Standard 34 and Appendix 16 of the Listing Rules issued by the Hong Kong Institute of Certified Public Accountants, adopting the historical cost principle, and the newly applied revised Hong Kong Financial Reporting Standards had no significant impact on financial position or performance - Basis of preparation: Prepared in accordance with Hong Kong Accounting Standard 34 and Appendix 16 of the Listing Rules issued by the Hong Kong Institute of Certified Public Accountants[31](index=31&type=chunk) - Accounting principles: Prepared on a historical cost basis, except for buildings and financial instruments measured at fair value[32](index=32&type=chunk) - Application of new standards: Revised Hong Kong Financial Reporting Standards were applied for the first time, but had no significant impact on the financial position or performance for the current and prior periods[32](index=32&type=chunk)[33](index=33&type=chunk) [Revenue and Segment Information](index=10&type=section&id=3.%20%E6%94%B6%E7%9B%8A%E5%8F%8A%E5%88%86%E9%83%A8%E8%B3%87%E6%96%99) The Group's revenue primarily stems from the Garment Manufacturing and Trading segment, which generated **HKD 86,947 thousand** in H1 2025, while the Securities Investment segment had no external revenue, with the Garment Manufacturing and Trading segment recording a loss of **HKD 22,678 thousand**, and the Securities Investment segment recording a loss of **HKD 1,109 thousand** - Revenue source: Primarily from the Garment Manufacturing and Trading segment, which generated **HKD 86,947 thousand** in H1 2025[35](index=35&type=chunk)[38](index=38&type=chunk) Segment Revenue and Loss | Segment | H1 2025 Revenue (thousand HKD) | H1 2025 Loss (thousand HKD) | H1 2024 Revenue (thousand HKD) | H1 2024 Loss (thousand HKD) | | :--- | :--- | :--- | :--- | :--- | | Garment Manufacturing and Trading | **86,947** | **(22,678)** | **280,835** | **(3,443)** | | Securities Investment | – | **(1,109)** | – | **(1,964)** | | **Total** | **86,947** | **(23,787)** | **280,835** | **(5,407)** | [Geographical Information](index=12&type=section&id=%E5%9C%B0%E5%9F%9F%E8%B3%87%E6%96%99) The Group's external customer revenue primarily originates from the US and Europe, while non-current assets are mainly located in Mainland China and Hong Kong, with revenue from the US and Europe significantly decreasing in H1 2025 External Customer Revenue (by Customer Location) | Region | H1 2025 (thousand HKD) | H1 2024 (thousand HKD) | | :--- | :--- | :--- | | United States | **38,697** | **143,501** | | Europe | **28,932** | **98,895** | | Hong Kong | **6,061** | **14,245** | | Other Regions | **13,257** | **24,194** | | **Total** | **86,947** | **280,835** | Non-current Assets (by Asset Location) | Region | June 30, 2025 (thousand HKD) | December 31, 2024 (thousand HKD) | | :--- | :--- | :--- | | Mainland China | **44,732** | **50,007** | | Hong Kong | **6,633** | **6,894** | | Other Regions | **2,863** | **3,078** | | **Total** | **54,228** | **59,979** | [Loss Before Tax](index=12&type=section&id=4.%20%E9%99%A4%E7%A8%85%E5%89%8D%E8%99%A7%E6%90%8D) Loss before tax is stated after deducting depreciation of right-of-use assets of **HKD 993 thousand** and depreciation of property, plant and equipment of **HKD 5,291 thousand** Depreciation Expenses | Item | H1 2025 (thousand HKD) | H1 2024 (thousand HKD) | | :--- | :--- | :--- | | Depreciation of Right-of-Use Assets | **993** | **1,026** | | Depreciation of Property, Plant and Equipment | **5,291** | **6,429** | [Income Tax Expense](index=12&type=section&id=5.%20%E6%89%80%E5%BE%97%E7%A8%85%E9%96%8B%E6%94%AF) The Group had no assessable profits subject to Hong Kong Profits Tax and China Corporate Income Tax in both H1 2025 and H1 2024, thus no related provision was made - Income tax provision: No income tax provision was made as there were no assessable profits in Hong Kong and Mainland China[42](index=42&type=chunk) [Loss Per Share](index=13&type=section&id=6.%20%E6%AF%8F%E8%82%A1%E8%99%A7%E6%90%8D) For the six months ended June 30, 2025, basic and diluted loss per share was **3.30 HK cents**, calculated based on a loss attributable to equity holders of the Group of **HKD 29,737 thousand** and a weighted average of **899,846 thousand** ordinary shares Basis for Loss Per Share Calculation | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Loss attributable to equity holders of the Group (thousand HKD) | **(29,737)** | **(12,168)** | | Weighted average number of ordinary shares (thousand shares) | **899,846** | **899,846** | | Basic and diluted loss per share (HK cents) | **(3.30)** | **(1.35)** | - Diluted loss: Diluted loss per share is not presented as there were no outstanding potential ordinary shares for both periods[43](index=43&type=chunk) [Trade and Other Receivables](index=13&type=section&id=7.%20%E8%B2%BF%E6%98%93%E5%8F%8A%E5%85%B6%E4%BB%96%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85) As of June 30, 2025, total trade and other receivables amounted to **HKD 30,211 thousand**, with trade receivables at **HKD 14,857 thousand**, and the aging analysis of trade receivables shows that amounts within **30 days** constitute the vast majority Composition of Receivables | Item | June 30, 2025 (thousand HKD) | December 31, 2024 (thousand HKD) | | :--- | :--- | :--- | | Trade Receivables | **14,857** | **26,189** | | Deposits and Other Receivables | **3,888** | **3,480** | | Prepayments | **11,466** | **1,248** | | **Total** | **30,211** | **30,917** | Aging Analysis of Trade Receivables | Aging | June 30, 2025 (thousand HKD) | December 31, 2024 (thousand HKD) | | :--- | :--- | :--- | | Within 30 days | **13,636** | **21,956** | | 31 to 60 days | **644** | **2,036** | | 61 to 90 days | **528** | **2,197** | | Over 90 days | **49** | – | | **Total** | **14,857** | **26,189** | [Trade and Other Payables](index=14&type=section&id=8.%20%E8%B2%BF%E6%98%93%E5%8F%8A%E5%85%B6%E4%BB%96%E6%87%89%E4%BB%98%E6%AC%BE%E9%A0%85) As of June 30, 2025, total trade and other payables amounted to **HKD 22,370 thousand**, with trade payables at **HKD 17,153 thousand**, and the aging analysis of trade payables shows that amounts within **30 days** constitute the major portion Composition of Payables | Item | June 30, 2025 (thousand HKD) | December 31, 2024 (thousand HKD) | | :--- | :--- | :--- | | Trade Payables | **17,153** | **19,424** | | Accruals and Other Payables | **5,217** | **11,275** | | **Total** | **22,370** | **30,699** | Aging Analysis of Trade Payables | Aging | June 30, 2025 (thousand HKD) | December 31, 2024 (thousand HKD) | | :--- | :--- | :--- | | Within 30 days | **13,387** | **15,891** | | 31 to 60 days | **3,548** | **1,952** | | 61 to 90 days | **218** | **1,386** | | Over 90 days | – | **195** | | **Total** | **17,153** | **19,424** | [Dividends](index=14&type=section&id=9.%20%E8%82%A1%E6%81%AF) The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025 - Interim dividend: The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025 (2024: nil)[47](index=47&type=chunk) [Other Information](index=4&type=section&id=%E5%85%B6%E4%BB%96%E4%BF%A1%E6%81%AF) [Events After the Reporting Period](index=4&type=section&id=%E6%9C%9F%E5%BE%8C%E4%BA%8B%E9%A0%85) As of the date of this announcement, the Board is not aware of any significant events occurring after the review period - Events after the reporting period: As of the date of this announcement, the Board is not aware of any significant events occurring after the review period[19](index=19&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=15&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 review period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - Securities transactions: During the review period, neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[48](index=48&type=chunk) [Review of Interim Results](index=15&type=section&id=%E5%AF%A9%E9%96%B1%E4%B8%AD%E6%9C%9F%E6%A5%AD%E7%B8%BE) The Audit Committee has reviewed the Group's unaudited interim results for the six months ended June 30, 2025, with the committee comprising three independent non-executive directors - Review status: The Audit Committee has reviewed the Group's unaudited interim results for the six months ended June 30, 2025[49](index=49&type=chunk) - Committee composition: Comprises three independent non-executive directors, including Mr. Cheng Wai Hei (Chairman), Mr. Lam Chi Wing, and Ms. Li Qian[49](index=49&type=chunk) [Corporate Governance Code and Compliance](index=15&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%AE%88%E5%89%87) During the review period, the Group complied with all code provisions of the Corporate Governance Code set out in Appendix C1 Part 2 of the Listing Rules, except for code provision C.2.1 regarding the Chief Executive Officer, whose duties are performed by executive directors on a rotational basis, an arrangement the Board believes ensures effective operation and a balance of power - Corporate Governance Code compliance: The Group complied with all code provisions of the Corporate Governance Code set out in Appendix C1 Part 2 of the Listing Rules, except for code provision C.2.1[50](index=50&type=chunk) - Chief Executive Officer position: No CEO has been appointed, and the role and functions are performed by executive directors on a rotational basis[50](index=50&type=chunk) - Board's view: The Board believes the current arrangement ensures a balance of power, facilitates prompt decision-making and execution, and effectively achieves company objectives[51](index=51&type=chunk) - Listing Rules compliance: Except for the disclosed matters, the Group has complied with the requirements of the Listing Rules[52](index=52&type=chunk) [Directors' Securities Transactions](index=16&type=section&id=%E8%91%A3%E4%BA%8B%E8%AD%89%E5%88%B8%E4%BA%A4%E6%98%93) The Group has adopted a code of conduct for directors' securities transactions, with standards no less exacting than those set out in Appendix C3 of the Listing Rules, and all directors confirmed compliance with the relevant code provisions during the review period - Code of conduct: A code of conduct for directors' securities transactions has been adopted, with standards no less exacting than those set out in Appendix C3 of the Listing Rules[53](index=53&type=chunk) - Compliance confirmation: All directors have confirmed compliance with the relevant code provisions during the review period[53](index=53&type=chunk) [Publication of Interim Results and Interim Report](index=16&type=section&id=%E5%88%8A%E7%99%BB%E4%BA%8C%E9%9B%B6%E4%BA%94%E4%BA%94%E5%B9%B4%E4%B8%AD%E6%9C%9F%E6%A5%AD%E7%B8%BE%E5%8F%8A%E4%B8%AD%E6%9C%9F%E5%A0%B1%E5%91%8A) This interim results announcement has been published on the websites of Hong Kong Exchanges and Clearing Limited and the Company, and the interim report, containing information required by the Listing Rules, will be dispatched to shareholders and published on the aforementioned websites in due course - Publication platforms: The interim results announcement has been published on the websites of Hong Kong Exchanges and Clearing Limited and the Company[54](index=54&type=chunk) - Interim report: The interim report, containing information required by the Listing Rules, will be dispatched to shareholders and published on the aforementioned websites in due course[54](index=54&type=chunk)