[Company Information](index=4&type=section&id=%E5%85%AC%E5%8F%B8%E8%B3%87%E6%96%99) [Company Information](index=4&type=section&id=%E5%85%AC%E5%8F%B8%E8%B5%84%E6%96%99) This section details the basic company information for Hong Kong Entertainment International Holdings Limited, covering governance, key personnel, and identifiers - Executive Directors: Mr. Wang Yun, Mr. Zou Yonggang[6](index=6&type=chunk) - Independent Non-executive Directors: Mr. Wong Shui Chi, Mr. Wu Chi King, Ms. Wan So Ying[6](index=6&type=chunk) - Company Stock Code: **8291**[7](index=7&type=chunk) [Financial Highlights](index=6&type=section&id=%E8%B2%A1%E5%8B%99%E6%91%98%E8%A6%81) [Financial Highlights](index=6&type=section&id=%E8%B2%A1%E5%8B%99%E6%91%98%E8%A6%81) The Group's revenue for the six months ended June 30, 2025, decreased by 36.0% to approximately RMB 24.4 million, while loss attributable to owners significantly narrowed to RMB 0.1 million Financial Highlights for H1 2025 | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 24.4 | 38.1 | -36.0% | | Loss Attributable to Owners | 0.1 | 11.1 | -99.1% | | Total Cash and Bank Balances | 3.6 | 7.1 (2024年12月31日) | -49.3% | | Gearing Ratio | 82.6% | 60.0% (2024年12月31日) | +22.6% | - The Board does not recommend an interim dividend for the six months ended June 30, 2025 (2024: nil)[8](index=8&type=chunk) [Unaudited Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=7&type=section&id=%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%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) [Unaudited Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=7&type=section&id=%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%90%8D%E7%9B%8A%E5%8F%8A%E5%85%B6%E4%BB%96%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) The Group's loss for the period significantly narrowed to RMB 0.17 million, driven by a net gain in other income and reduced operating expenses Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (RMB thousand) | Metric | H1 2025 | H1 2024 | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 24,396 | 38,080 | -36.0% | | Cost of Sales | (23,279) | (37,284) | -37.5% | | Gross Profit | 1,117 | 796 | +40.3% | | Net Other Income / (Loss) | 2,150 | (5,516) | N/A (Turned from loss to gain) | | Selling Expenses | (93) | (770) | -87.9% | | Administrative and Other Expenses | (2,477) | (3,984) | -37.8% | | Finance Costs | (867) | (1,659) | -47.8% | | Loss Before Income Tax | (170) | (11,133) | -98.5% | | Loss for the Period | (170) | (11,133) | -98.5% | | Loss Attributable to Owners for the Period | (147) | (11,133) | -98.7% | | Basic and Diluted Loss Per Share (RMB cents) | (0.09) | (6.96) | -98.7% | [Unaudited Condensed Consolidated Statement of Financial Position](index=9&type=section&id=%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) [Unaudited Condensed Consolidated Statement of Financial Position](index=9&type=section&id=%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) As of June 30, 2025, the Group's current and non-current assets decreased, leading to a slight increase in net current liabilities and net liabilities, further expanding the capital deficit Condensed Consolidated Statement of Financial Position (RMB thousand) | Metric | As of June 30, 2025 | As of Dec 31, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Non-current Assets | 1,718 | 2,084 | -17.5% | | Current Assets | 32,168 | 44,614 | -27.9% | | Current Liabilities | 81,681 | 93,723 | -12.8% | | Net Current Liabilities | (49,513) | (49,109) | +0.8% (负债增加) | | Net Liabilities | (94,368) | (93,598) | +0.8% (负债增加) | | Equity Attributable to Owners | (94,305) | (93,558) | +0.8% (亏损增加) | | Capital Deficit | (94,368) | (93,598) | +0.8% (亏绌增加) | [Unaudited Condensed Consolidated Statement of Changes in Equity](index=11&type=section&id=%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%AC%8A%E7%9B%8A%E8%AE%8A%E5%8B%95%E8%A1%A8) [Unaudited Condensed Consolidated Statement of Changes in Equity](index=11&type=section&id=%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%AC%8A%E7%9B%8A%E8%AE%8A%E5%8B%95%E8%A1%A8) Equity attributable to owners decreased due to loss for the period and exchange differences, partially offset by reclassification from share option reserve Condensed Consolidated Statement of Changes in Equity (RMB thousand) | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Loss for the Period | (170) | (11,133) | | Exchange Differences on Translation of Foreign Operations | (600) | 492 | | Total Comprehensive Expenses for the Period | (770) | (10,648) | | Lapse of Share Options | (1,266) (从购股权储备扣减并重新分类至累计亏损) | (479) (从购股权储备扣减并重新分类至累计亏损) | | Equity Attributable to Owners as of Period End | (94,305) | (97,983) | [Unaudited Condensed Consolidated Statement of Cash Flows](index=12&type=section&id=%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E7%8F%BE%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) [Unaudited Condensed Consolidated Statement of Cash Flows](index=12&type=section&id=%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E7%8F%BE%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) The Group's cash and cash equivalents decreased by RMB 0.471 million, primarily due to cash outflows from operating and financing activities Condensed Consolidated Statement of Cash Flows (RMB thousand) | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Net Cash Used in Operating Activities | (1,345) | (14,409) | | Net Cash From Investing Activities | 1,741 | 3,455 | | Net Cash Used in Financing Activities | (867) | (1,659) | | Net Decrease in Cash and Cash Equivalents | (471) | (12,613) | | Cash and Cash Equivalents at Period End | 3,565 | 7,999 | [Notes to the Unaudited Condensed Consolidated Interim Financial Information](index=13&type=section&id=%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E4%B8%AD%E6%9C%9F%E8%B2%A1%E5%8B%99%E8%B3%87%E6%96%99%E9%99%84%E8%A8%BB) [1. General Information and Basis of Preparation](index=13&type=section&id=1.%20%E4%B8%80%E8%88%AC%E8%B3%87%E6%96%99%E5%8F%8A%E7%B7%A8%E8%A3%BD%E5%9F%BA%E6%BA%96) This section outlines the company's registration, principal activities, functional currency, and the basis of preparing interim financial information, highlighting going concern uncertainties and mitigation plans - The company was incorporated in the Cayman Islands, with shares listed on GEM of the Hong Kong Stock Exchange since **July 18, 2017**[15](index=15&type=chunk)[16](index=16&type=chunk) - The Group primarily engages in (i) manufacturing and selling tinplate and tinplate packaging products in China; and (ii) product repackaging and sales in Hong Kong[15](index=15&type=chunk) - For the six months ended June 30, 2025, the Group incurred a net loss of approximately **RMB 0.17 million**, with net current liabilities and net liabilities of approximately **RMB 49.513 million** and **RMB 94.368 million** respectively, indicating significant going concern uncertainties[19](index=19&type=chunk) - To address going concern uncertainties, the Group plans to utilize unutilized bank facilities (**RMB 52 million**), secure funding from former directors, seek other financing, and implement cost control measures[21](index=21&type=chunk) [2. Revenue, Other Income / (Loss) Net, and Segment Information](index=15&type=section&id=2.%20%E6%94%B6%E7%9B%8A%E3%80%81%E5%85%B6%E4%BB%96%E6%94%B6%E7%9B%8A%E2%88%95%EF%BC%88%E4%BA%8F%E6%90%8D%EF%BC%89%E5%87%80%E9%A1%8D%E5%8F%8A%E5%88%86%E9%83%A8%E8%B3%87%E6%96%99) The Group's revenue, primarily from China tin business and Hong Kong product repackaging, decreased by 36.0%, with net other income turning profitable due to financial assets Revenue and Net Other Income / (Loss) (RMB thousand) | Metric | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Revenue from Sales of Tinplate Packaging Products and Tinplate | 20,403 | 38,080 | | Revenue from Product Repackaging and Sales | 3,993 | – | | **Total Revenue** | **24,396** | **38,080** | | Realized and Unrealized Fair Value Gains / (Losses) on Financial Assets at FVTPL | 2,146 | (5,571) | | Gain on Disposal of Property, Plant and Equipment | 4 | – | | Gain on Disposal of a Subsidiary | – | 55 | | **Net Other Income / (Loss)** | **2,150** | **(5,516)** | - The Group's chief operating decision maker reviews overall financial performance, thus no segment information is reported[25](index=25&type=chunk) - Revenue from China (excluding Hong Kong) was **RMB 20,403 thousand** (2024: RMB 38,080 thousand), and from Hong Kong, China was **RMB 3,993 thousand** (2024: nil)[26](index=26&type=chunk) [3. Finance Costs](index=17&type=section&id=3.%20%E8%9E%8D%E8%B3%87%E6%88%90%E6%9C%AC) The Group's finance costs, mainly interest on borrowings, significantly decreased by 47.8% for the six months ended June 30, 2025 Finance Costs (RMB thousand) | Metric | H1 2025 | H1 2024 | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Interest Expense on Borrowings | 867 | 1,659 | -47.8% | [4. Income Tax](index=17&type=section&id=4.%20%E6%89%80%E5%BE%97%E7%A8%85) No income tax provision was made in Hong Kong due to no taxable profits, and in China due to tax losses incurred by subsidiaries - No Hong Kong profits tax provision was made for the six months ended June 30, 2025 and 2024, as the Group had no taxable profits in Hong Kong[32](index=32&type=chunk) - No China corporate income tax provision was made for the six months ended June 30, 2025 and 2024, as the Group's PRC subsidiaries incurred tax losses in China[32](index=32&type=chunk) [5. Loss Before Income Tax](index=17&type=section&id=5.%20%E9%99%A4%E6%89%80%E5%BE%97%E7%A8%85%E5%89%8D%E4%BA%8F%E6%90%8D) This section details key deductions from loss before income tax, including inventory costs and depreciation of property, plant, and equipment, all showing decreases Deductions from Loss Before Income Tax (RMB thousand) | Metric | H1 2025 | H1 2024 | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Cost of Inventories Recognized as Expense | 23,279 | 37,284 | -37.5% | | Depreciation of Property, Plant and Equipment | 595 | 1,948 | -69.5% | | Depreciation of Right-of-use Assets | – | 12 | -100% | [6. Dividends](index=18&type=section&id=6.%20%E8%82%A1%E6%81%AF) No dividends were paid or proposed for the six months ended June 30, 2025 - No dividends were paid or proposed for the six months ended June 30, 2025, and no dividends have been proposed since the end of the reporting period (2024: nil)[35](index=35&type=chunk) [7. Loss Per Share](index=18&type=section&id=7.%20%E6%AF%8F%E8%82%A1%E4%BA%8F%E6%90%8D) The Group's basic and diluted loss per share was RMB 0.09 cents, a significant reduction from the prior year, with basic and diluted losses being identical Loss Per Share (RMB cents) | Metric | H1 2025 | H1 2024 | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Basic and Diluted Loss Per Share | (0.09) | (6.96) | -98.7% | - The weighted average number of ordinary shares in issue was **160,000,000** shares[36](index=36&type=chunk) [8. Property, Plant and Equipment](index=18&type=section&id=8.%20%E7%89%A9%E6%A5%AD%E3%80%81%E5%BB%A0%E6%88%BF%E5%8F%8A%E8%A8%AD%E5%82%99) The Group acquired RMB 249,000 in property, plant, and equipment and recognized a gain of RMB 4,000 from asset disposals during the period - For the six months ended June 30, 2025, the Group acquired property, plant and equipment of **RMB 249 thousand** (2024: RMB 100 thousand)[37](index=37&type=chunk) - Proceeds from disposal of property, plant and equipment were approximately **RMB 24 thousand**, with a recognized gain of approximately **RMB 4 thousand**[37](index=37&type=chunk) [9. Inventories](index=18&type=section&id=9.%20%E5%AD%98%E8%B2%A8) As of June 30, 2025, the Group's total inventories decreased by 31.8% to RMB 5,810 thousand, mainly in raw materials and work-in-progress Inventories Composition (RMB thousand) | Metric | As of June 30, 2025 | As of Dec 31, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Raw Materials | 3,110 | 5,319 | -41.5% | | Work-in-progress | 54 | 182 | -70.3% | | Finished Goods | 2,646 | 3,025 | -12.5% | | **Total Inventories** | **5,810** | **8,526** | **-31.8%** | [10. Trade and Other Receivables](index=19&type=section&id=10.%20%E8%B2%BF%E6%98%93%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85) Net trade receivables significantly decreased by 61.8% to RMB 5,587 thousand, primarily due to reduced receivables from customer contracts, with a typical credit period of 180 days Trade and Other Receivables (RMB thousand) | Metric | As of June 30, 2025 | As of Dec 31, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Trade Receivables Arising from Customer Contracts | 13,797 | 22,850 | -39.6% | | Less: Provision for Expected Credit Losses | (8,210) | (8,210) | 0% | | **Net Trade Receivables** | **5,587** | **14,640** | **-61.8%** | - The general credit period ranges up to **180 days**[39](index=39&type=chunk) [11. Financial Assets at Fair Value Through Profit or Loss](index=20&type=section&id=11.%20%E6%8C%89%E5%85%AC%E5%B9%B3%E5%80%BC%E8%A8%88%E5%85%A5%E6%90%8D%E7%9B%8A%E7%9A%84%E9%87%91%E8%9E%8D%E8%B3%87%E7%94%A2) The Group's financial assets at fair value through profit or loss, primarily Hong Kong-listed equity securities, increased to RMB 12,716 thousand as of June 30, 2025 Financial Assets at Fair Value Through Profit or Loss (RMB thousand) | Metric | As of June 30, 2025 | As of Dec 31, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Hong Kong-listed Equity Securities | 12,716 | 9,541 | +33.3% | [12. Trade and Other Payables](index=20&type=section&id=12.%20%E8%B2%BF%E6%98%93%E6%87%89%E4%BB%98%E6%AC%BE%E9%A0%85%E5%8F%8A%E6%87%89%E4%BB%98%E7%A5%A8%E6%93%9A) Total trade and other payables decreased by 33.6% to RMB 35,212 thousand, with bills payable eliminated and a typical supplier credit period of 90 days Trade and Other Payables (RMB thousand) | Metric | As of June 30, 2025 | As of Dec 31, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Trade Payables | 35,212 | 43,009 | -18.1% | | Bills Payable | – | 9,984 | -100% | | **Total** | **35,212** | **52,993** | **-33.6%** | - The credit period granted by suppliers is normally **90 days**[41](index=41&type=chunk) [13. Borrowings](index=21&type=section&id=13.%20%E5%80%9F%E6%AC%BE) Total borrowings remained at RMB 74,573 thousand, comprising secured bank loans and unsecured loans, with RMB 52,000 thousand in unutilized bank facilities Borrowings Composition (RMB thousand) | Metric | As of June 30, 2025 | As of Dec 31, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Secured Bank Borrowings (Current Liabilities) | 28,000 | 28,000 | 0% | | Unsecured Borrowings (Non-current Liabilities) | 46,573 | 46,573 | 0% | | **Total Borrowings** | **74,573** | **74,573** | **0%** | - Unsecured borrowings of **RMB 46.573 million** are amounts due to former directors, interest-free, with repayment extended to **June 30, 2027**[43](index=43&type=chunk) - Unutilized bank facilities amount to **RMB 52 million**, valid until **September 2, 2027**[44](index=44&type=chunk) [14. Share Capital](index=22&type=section&id=14.%20%E8%82%A1%E6%9C%AC) The company's authorized and issued share capital remained unchanged during the reporting period Share Capital Information | Metric | As of June 30, 2025 (thousand shares) | As of Dec 31, 2024 (thousand shares) | | :--- | :--- | :--- | | Authorized Ordinary Shares (HKD 0.20 par value per share) | 500,000 | 500,000 | | Issued and Fully Paid Ordinary Shares (HKD 0.20 par value per share) | 160,000 | 160,000 | [15. Share Option Scheme](index=22&type=section&id=15.%20%E8%B3%BC%E8%82%A1%E6%AC%8A%E8%A8%88%E5%8A%83) The company's share option scheme aims to attract and incentivize participants, with unexercised options significantly reduced to 2,519,352 due to expirations - The share option scheme was adopted on **June 23, 2017**, for a ten-year term, aiming to attract, retain, and incentivize eligible participants[46](index=46&type=chunk) - As of June 30, 2025, the number of outstanding share options was **2,519,352** (December 31, 2024: 10,775,352)[49](index=49&type=chunk) - For the six months ended June 30, 2025, **8,256,000** share options lapsed, resulting in **RMB 1.266 million** being reclassified from the share option reserve to accumulated losses[52](index=52&type=chunk) - No share options were granted by the company for the six months ended June 30, 2025 and 2024[53](index=53&type=chunk) [16. Fair Value Measurement](index=26&type=section&id=16.%20%E5%85%AC%E5%B9%B3%E5%80%BC%E8%A8%88%E9%87%8F) The Group's financial assets measured at fair value, primarily Hong Kong-listed equity securities, are valued using Level 1 inputs from active market quotes - Fair value measurement inputs are categorized into three levels: Level 1 (quoted prices in active markets), Level 2 (observable inputs), and Level 3 (unobservable inputs)[57](index=57&type=chunk) - Financial assets at fair value through profit or loss (Hong Kong-listed equity securities) are measured using Level 1 inputs (quoted bid prices on the Stock Exchange), amounting to **RMB 12,716 thousand** as of June 30, 2025[59](index=59&type=chunk) [17. Events After the Reporting Period](index=28&type=section&id=17.%20%E5%A0%B1%E5%91%8A%E6%9C%9F%E5%BE%8C%E4%BA%8B%E9%A0%85) Subsequent to the reporting period, the Board proposed a capital reorganization, including share consolidation, capital reduction, and share subdivision, pending approvals - The proposed capital reorganization includes: consolidating every **3** shares of HKD **0.2** par value into **1** share of HKD **0.6** par value; reducing the paid-up capital of each consolidated share to HKD **0.006**; and subdividing each authorized but unissued share into **100** new shares of HKD **0.006** par value[63](index=63&type=chunk) - The capital reorganization is subject to shareholder approval, Stock Exchange Listing Committee approval, and other regulatory requirements[61](index=61&type=chunk) [Management Discussion and Analysis](index=29&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 Activities](index=29&type=section&id=%E6%A5%AD%E5%8B%99%E6%B4%BB%E5%8B%95) The Group's core business involves manufacturing and selling tinplate packaging products in China and providing repackaging services in Hong Kong, with no significant operational changes since listing - The Group primarily (i) manufactures and sells tinplate packaging products in China; and (ii) provides repackaging services in Hong Kong[64](index=64&type=chunk) - Since its listing on **July 18, 2017**, the Group's business operations have seen no significant changes[64](index=64&type=chunk) [Business Review and Outlook](index=29&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7%E5%8F%8A%E5%B1%95%E6%9C%9B) First-half revenue decreased by 36.0% due to China's economic downturn, but loss significantly narrowed by 98.2% due to financial asset gains and cost controls - Revenue decreased by approximately **36.0%** from **RMB 38.1 million** to **RMB 24.4 million**, mainly due to reduced sales demand amid China's economic downturn[65](index=65&type=chunk) - Loss for the period decreased from approximately **RMB 11.1 million** to **RMB 0.2 million**, primarily due to fair value gains from financial assets (**RMB 2.1 million**) from a recovering Hong Kong stock market and cost control measures[65](index=65&type=chunk) - Looking ahead, the Group plans to consolidate its market share in tinplate packaging, expand its product and service portfolio, broaden sales channels, and implement cost control strategies to improve cash flow[66](index=66&type=chunk) [Debts and Charges on Assets](index=30&type=section&id=%E5%82%B5%E5%8B%99%E5%8F%8A%E8%B3%87%E7%94%A2%E6%8A%B5%E6%8A%BC) As of June 30, 2025, the Group had RMB 28.0 million in secured borrowings and RMB 46.6 million in unsecured borrowings, with RMB 52 million in unutilized bank facilities - Secured borrowings were **RMB 28.0 million**, and unsecured borrowings were approximately **RMB 46.6 million**, both consistent with December 31, 2024[67](index=67&type=chunk) - Bank borrowings and other bank facilities are secured by a building held by a subsidiary owned by former directors[68](index=68&type=chunk) - Unutilized bank facilities amount to approximately **RMB 52 million**[68](index=68&type=chunk) [Financial Review](index=31&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) This section reviews the Group's financial performance, detailing changes in revenue, cost of sales, gross profit, other income/loss, operating expenses, finance costs, and period loss [Revenue](index=31&type=section&id=%E6%94%B6%E7%9B%8A) - Revenue decreased by 36.0% to RMB 24.4 million, primarily due to reduced sales demand amid China's economic slowdown[69](index=69&type=chunk) [Cost of Sales](index=31&type=section&id=%E9%8A%B7%E5%94%AE%E6%88%90%E6%9C%AC) - Cost of sales decreased by approximately **37.5%** from **RMB 37.3 million** to **RMB 23.3 million**, consistent with the revenue decrease[70](index=70&type=chunk) [Gross Profit and Gross Profit Margin](index=31&type=section&id=%E6%AF%9B%E5%88%A9%E5%8F%8A%E6%AF%9B%E5%88%A9%E7%8E%87) - Gross profit increased from approximately **RMB 0.8 million** to **RMB 1.1 million**, with gross profit margin rising from **2.1%** to **4.6%**, mainly due to higher average selling prices[71](index=71&type=chunk) [Net Other Income / Loss](index=32&type=section&id=%E5%85%B6%E4%BB%96%E6%94%B6%E7%9B%8A%E2%88%95%E4%BA%8F%E6%90%8D%E5%87%80%E9%A1%8D) - Net other income/loss turned into a gain of approximately **RMB 2.1 million** (2024: loss of approximately RMB 5.6 million), primarily due to increased realized and unrealized fair value gains from financial assets as the Hong Kong stock market recovered[72](index=72&type=chunk) [Selling Expenses](index=32&type=section&id=%E9%8A%B7%E5%94%AE%E9%96%8B%E6%94%AF) - Selling expenses decreased by approximately **87.5%** from **RMB 0.8 million** to **RMB 0.1 million**, mainly due to implemented cost controls[73](index=73&type=chunk) [Administrative and Other Expenses](index=32&type=section&id=%E8%A1%8C%E6%94%BF%E5%8F%8A%E5%85%B6%E4%BB%96%E9%96%8B%E6%94%AF) - Administrative and other expenses decreased by approximately **37.5%** from **RMB 4.0 million** to **RMB 2.5 million**, mainly due to implemented cost controls[74](index=74&type=chunk) [Finance Costs](index=32&type=section&id=%E8%9E%8D%E8%B3%87%E6%88%90%E6%9C%AC) - Finance costs decreased by approximately **47.1%** from **RMB 1.7 million** to **RMB 0.9 million**, mainly due to reduced utilized bank financing[75](index=75&type=chunk) [Loss for the Period](index=33&type=section&id=%E6%9C%9F%E5%85%A7%E4%BA%8F%E6%90%8D) - Loss for the period decreased from approximately **RMB 11.1 million** to **RMB 0.2 million**, a result of the combined effects of the aforementioned factors[76](index=76&type=chunk) [Dividends](index=33&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 an interim dividend for the six months ended June 30, 2025[77](index=77&type=chunk) [Liquidity and Financial Resources](index=33&type=section&id=%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E5%8F%8A%E8%B2%A1%E5%8B%99%E8%B3%87%E6%BA%90) The Group's liquidity primarily stems from operating cash inflows, but cash and bank balances decreased, and the gearing ratio increased, with management closely monitoring the situation - As of June 30, 2025, the Group's total cash and bank balances were approximately **RMB 3.6 million** (December 31, 2024: RMB 7.1 million)[78](index=78&type=chunk) - The gearing ratio increased from approximately **60.0%** as of December 31, 2024, to approximately **82.6%** as of June 30, 2025[78](index=78&type=chunk) - The Group adopts a conservative approach to financial policies, with the Board closely monitoring liquidity[79](index=79&type=chunk) [Key Risks, Uncertainties and Risk Management](index=34&type=section&id=%E4%B8%BB%E8%A6%81%E9%A2%A8%E9%9A%AA%E3%80%81%E4%B8%8D%E7%A2%BA%E5%AE%9A%E6%80%A7%E5%8F%8A%E9%A2%A8%E9%9A%AA%E7%AE%A1%E7%90%86) The Group's primary credit risk arises from trade and other receivables and bank cash, managed through credit policies and individual customer credit assessments - The Group's credit risk primarily arises from trade and other receivables and bank cash[81](index=81&type=chunk) - Credit policies are established, and credit risk is continuously monitored through individual credit assessments of customers[81](index=81&type=chunk) [Significant Acquisitions and Disposals of Subsidiaries](index=34&type=section&id=%E9%87%8D%E5%A4%A7%E6%94%B6%E8%B3%BC%E5%8F%8A%E5%87%BA%E5%94%AE%E9%99%84%E5%B1%AC%E5%85%AC%E5%8F%B8) The Group did not undertake any significant acquisitions or disposals of subsidiaries for the six months ended June 30, 2025 - For the six months ended June 30, 2025, the Group did not undertake any significant acquisitions or disposals of subsidiaries[82](index=82&type=chunk) [Contingent Liabilities](index=34&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[83](index=83&type=chunk) [Employees and Remuneration Policy](index=34&type=section&id=%E5%83%B1%E5%93%A1%E5%8F%8A%E8%96%AA%E9%85%AC%E6%94%BF%E7%AD%96) As of June 30, 2025, the Group's employee count decreased to 58, with a corresponding reduction in employee costs, and remuneration policies are based on industry practice and performance - As of June 30, 2025, the Group employed **58** employees (December 31, 2024: 75 employees)[84](index=84&type=chunk) - For the six months ended June 30, 2025, the Group's employee costs were approximately **RMB 1.3 million** (2024: RMB 1.8 million)[84](index=84&type=chunk) - Employee remuneration levels are in line with industry practice and market conditions, with overall compensation determined by the Group based on employee qualifications and performance[84](index=84&type=chunk) [Material Investments Held](index=35&type=section&id=%E6%89%80%E6%8C%81%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B3%87) The Group holds approximately RMB 12.7 million in Hong Kong-listed equity securities, planning portfolio diversification and adhering to a strict risk management framework [Investment Portfolio Overview](index=35&type=section&id=%E6%8A%95%E8%B3%87%E7%B5%84%E5%90%88%E6%A6%82%E8%A6%BD) - As of June 30, 2025, the Group held **17** Hong Kong-listed equity securities with a fair value of approximately **RMB 12.7 million**[85](index=85&type=chunk) - The Group intends to diversify its investment portfolio to mitigate concentration and investment risks[85](index=85&type=chunk) Major Equity Securities Investments (As of June 30, 2025) | Company Name / Stock Code | Percentage Held | Fair Value (Loss) / Gain for H1 2025 (RMB thousand) | Fair Value as of June 30, 2025 (RMB thousand) | Percentage of Total Group Assets | | :--- | :--- | :--- | :--- | :--- | | Harbour Digital Industry Capital Limited (913) | 2.9% | (1,207) | 3,750 | 11.1% | | China Investment and Finance Group Limited (1226) | 0.4% | 1,834 | 2,481 | 7.3% | | Lisi Group Holdings Limited (1327) | 4.8% | 1,142 | 2,415 | 7.1% | | Other Listed Securities | N/A | N/A | 4,070 | 12.0% | | **Total** | N/A | N/A | **12,716** | **37.5%** | [Investment Policy and Objectives](index=37&type=section&id=%E6%8A%95%E8%B3%87%E6%94%BF%E7%AD%96%E8%88%87%E7%9B%AE%E6%A8%99) The primary objective is long-term capital appreciation and high growth through diversified investments in listed equity securities, prohibiting excessive leverage or speculative derivatives - The primary objective is to achieve long-term capital appreciation and high growth by investing idle funds in a diversified portfolio of listed equity securities[89](index=89&type=chunk) - Permitted investments are limited to listed equities on globally recognized exchanges, with the portfolio remaining diversified and minimum holding quantities set to reduce risk[89](index=89&type=chunk) - The use of excessive leverage, investment in unlisted securities, or speculative derivative trading is prohibited[89](index=89&type=chunk) [Risk Management and Control Measures](index=37&type=section&id=%E9%A2%A8%E9%9A%AA%E7%AE%A1%E7%90%86%E8%88%87%E6%8E%A7%E5%88%B6%E6%8E%AA%E6%96%BD) A stringent risk management framework is employed, actively managing liquidity risk through tiered limits and maintaining a diversified portfolio to minimize single investment exposure - A stringent risk management framework is adopted, actively managing liquidity risk through a strict tiered limit structure[90](index=90&type=chunk) - A diversified investment portfolio with predetermined limits is maintained, ensuring no single investment exceeds a small percentage of the portfolio's value[90](index=90&type=chunk) - All transactions are executed through reputable, regulated financial institutions to minimize counterparty risk[90](index=90&type=chunk) [Approval and Oversight Mechanism for Investment Decisions](index=38&type=section&id=%E6%8A%95%E8%B3%87%E6%B1%BA%E7%AD%96%E7%9A%84%E5%AF%A9%E6%89%B9%E8%88%87%E7%9B%A3%E7%9D%A3%E6%A9%9F%E5%88%B6) Investment decisions are governed by a multi-layered approval and oversight structure, led by executive directors, with internal compliance screening and regular board reporting - Investment decisions are governed by a multi-layered approval and oversight structure, led by Executive Directors Mr. Wang Yun and Mr. Zou Yonggang[91](index=91&type=chunk)[92](index=92&type=chunk) - The internal compliance team is responsible for initial screening of all proposed transactions involving the purchase, sale, or subscription of listed securities to assess if they constitute disclosable transactions[91](index=91&type=chunk) - All investment decisions are based on comprehensive due diligence, pre-defined investment mandates with clearly defined risk parameters and asset allocation, and are regularly reported to the Board[92](index=92&type=chunk) [Foreign Exchange Risk](index=39&type=section&id=%E5%A4%96%E5%8C%AF%E9%A2%A8%E9%9A%AA) The Group faces minimal foreign exchange risk as its primary business is in China, with most transactions settled in RMB, and no hedging activities were undertaken - The Group's primary business is located in China, with most transactions settled in RMB, resulting in minimal foreign exchange risk[94](index=94&type=chunk) - For the six months ended June 30, 2025, the Group did not hedge any foreign exchange risk[94](index=94&type=chunk) [Capital Structure](index=39&type=section&id=%E8%B3%87%E6%9C%AC%E6%9E%B6%E6%A7%8B) As of June 30, 2025, the company's issued share capital and number of ordinary shares remained unchanged at HKD 32,000,000 (approximately RMB 27,909,000) and 160,000,000 shares - As of June 30, 2025, the company's issued share capital was **HKD 32,000,000** (equivalent to approximately **RMB 27,909,000**), with **160,000,000** ordinary shares issued, each with a par value of **HKD 0.2**[95](index=95&type=chunk) - Except for changes disclosed elsewhere in this interim report, there were no changes to the company's capital structure[95](index=95&type=chunk) [Future Plans for Material Investments and Capital Assets](index=39&type=section&id=%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B3%87%E5%8F%8A%E8%B3%87%E6%9C%AC%E8%B3%87%E7%94%A2%E4%B9%8B%E6%9C%AA%E4%BE%86%E8%A8%88%E5%8A%83) Except as disclosed in this interim report, the Group had no other significant investment or capital asset plans as of June 30, 2025 - Except as disclosed in this interim report, the Group had no other significant investment or capital asset plans as of June 30, 2025[96](index=96&type=chunk) [Other Information Disclosure](index=40&type=section&id=%E5%85%B6%E4%BB%96%E8%B3%87%E6%96%99%E6%8A%AB%E9%9C%B2) [Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares and Debentures of the Company](index=40&type=section&id=%E8%91%A3%E4%BA%8B%E5%8F%8A%E4%B8%BB%E8%A6%81%E8%A1%8C%E6%94%BF%E4%BA%BA%E5%93%A1%E6%96%BC%E6%9C%AC%E5%85%AC%E5%8F%B8%E7%9A%84%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%E6%AC%8A%E8%AD%89%E4%B8%AD%E7%9A%84%E6%AC%8A%E7%9B%8A%E5%8F%8A%E6%B7%A1%E5%80%89) As of June 30, 2025, no directors or chief executives held disclosable interests or short positions in the company's shares, underlying shares, or debentures, beyond what is already reported - As of June 30, 2025, no directors or chief executives held disclosable interests or short positions in the shares, underlying shares, or debentures of the company or its associated corporations, other than as disclosed elsewhere in this report[97](index=97&type=chunk) [Measures to Enhance Shareholder Value](index=40&type=section&id=%E6%8F%90%E5%8D%87%E8%82%A1%E6%9D%B1%E5%83%B9%E5%80%BC%E7%9A%84%E6%8E%AA%E6%96%BD) The company is committed to enhancing long-term shareholder value through a rigorous capital allocation framework, prioritizing operational funding, strategic reinvestment, and shareholder returns - The company is committed to enhancing long-term shareholder value through a rigorous and strategic capital allocation framework, balancing shareholder returns with funding for operational excellence and future growth[98](index=98&type=chunk) - Capital allocation priorities: 1. Funding daily operations and core business growth; 2. Strategic reinvestment for returns; 3. Returning capital to shareholders[100](index=100&type=chunk) - All significant allocation decisions require full Board approval to ensure alignment with the objective of maximizing long-term shareholder value[99](index=99&type=chunk) [Substantial Shareholders' and Other Persons' Interests and Short Positions in Shares, Underlying Shares and Debentures of the Company](index=42&type=section&id=%E4%B8%BB%E8%A6%81%E8%82%A1%E6%9D%B1%E5%8F%8A%E5%85%B6%E4%BB%96%E4%BA%BA%E5%A3%AB%E6%96%BC%E6%9C%AC%E5%85%AC%E5%8F%B8%E7%9A%84%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%E6%AC%8A%E8%AD%89%E4%B8%AD%E7%9A%84%E6%AC%8A%E7%9B%8A%E5%8F%8A%E6%B7%A1%E5%80%89) As of June 30, 2025, no substantial shareholders or other persons, apart from the disclosed directors and chief executives, held disclosable interests or short positions in the company's shares or underlying shares - As of June 30, 2025, no person (other than the directors and chief executives disclosed above) held disclosable interests or short positions in the shares or underlying shares[101](index=101&type=chunk) [Dividend Policy](index=42&type=section&id=%E8%82%A1%E6%81%AF%E6%94%BF%E7%AD%96) The company's dividend policy prioritizes cash dividends, with the payout ratio determined by the Board based on financial performance, future prospects, and investment needs, subject to legal and financing constraints - The company has adopted a dividend policy prioritizing cash dividends to share profits with shareholders[102](index=102&type=chunk) - The dividend payout ratio will be determined at the Board's sole discretion, considering the company's financial performance, future prospects, investment and operational needs, overall financial health, and general market conditions[102](index=102&type=chunk) - The dividend policy is subject to the company's articles of association, applicable restrictions and requirements under Cayman Islands law, and any banking or other financing covenants binding the company[102](index=102&type=chunk) [Share Option Scheme](index=43&type=section&id=%E8%B3%BC%E8%82%A1%E6%AC%8A%E8%A8%88%E5%88%83) As of June 30, 2025, 2,519,352 unexercised share options remain under the company's share option scheme, with 8,256,000 employee options having lapsed during the period - As of June 30, 2025, **2,519,352** share options granted under the scheme remained unexercised[103](index=103&type=chunk) Overview of Share Option Movements (As of June 30, 2025) | Category of Participant | Grant Date | Exercise Period | Outstanding as of Jan 1, 2025 | Lapsed / Cancelled in H1 2025 | Outstanding as of June 30, 2025 | Exercise Price Per Share (HKD) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Employees | 2019年4月10日 | 10年 | 2,204,440 | – | 2,204,440 | 1.981 | | Employees | 2022年4月6日 | 3年 | 8,256,000 | (8,256,000) | – | 0.400 | | Consultants | 2019年4月10日 | 10年 | 314,912 | – | 314,912 | 1.981 | | **Total** | N/A | N/A | **10,775,352** | **(8,256,000)** | **2,519,352** | N/A | [Purchase, Sale or Redemption of the Company's Listed Securities](index=44&type=section&id=%E8%B3%BC%E8%B2%B7%E3%80%81%E5%87%BA%E5%94%AE%E6%88%96%E8%B3%96%E5%9B%9E%E6%9C%AC%E5%85%AC%E5%8F%B8%E4%B8%8A%E5%B8%82%E8%AD%89%E5%88%B8) Neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities for the six months ended June 30, 2025 - 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[105](index=105&type=chunk) [Directors' Contractual Interests](index=44&type=section&id=%E8%91%A3%E4%BA%8B%E4%B9%8B%E5%90%88%E7%B4%84%E6%AC%8A%E7%9B%8A) As of June 30, 2025, no directors held significant beneficial interests, directly or indirectly, in any material contracts entered into by the company or its subsidiaries - As of June 30, 2025, no directors had a material beneficial interest, directly or indirectly, in any significant contract entered into by the company or its subsidiaries[106](index=106&type=chunk) [Competing Interests of Directors and Controlling Shareholders](index=44&type=section&id=%E8%91%A3%E4%BA%8B%E5%8F%8A%E6%8E%A7%E8%82%A1%E8%82%A1%E6%9D%B1%E4%B9%8B%E7%AB%B6%E7%88%AD%E6%AC%8A%E7%9B%8A) As of June 30, 2025, the directors were unaware of any competing businesses or interests held by directors, controlling shareholders, or their associates that compete with the Group's business - As of June 30, 2025, the directors were unaware of any business or interest held by directors, controlling shareholders, or their associates that competes or may compete with the Group's business[107](index=107&type=chunk) [Directors' Securities Transactions](index=44&type=section&id=%E8%91%A3%E4%BA%8B%E4%B9%8B%E8%AD%89%E5%88%B8%E4%BA%A4%E6%98%93) All directors confirmed compliance with the required dealing standards under the GEM Listing Rules and the company's guidelines for directors' securities transactions - Following specific enquiries with all directors, the directors confirmed compliance with the required dealing standards and guidelines for directors' securities transactions as of the report date[108](index=108&type=chunk) [Compliance with Corporate Governance Code Practices](index=44&type=section&id=%E9%81%B5%E5%AE%88%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%AE%88%E5%89%87%E5%B8%B8%E8%A6%8F) The company adheres to the principles and applicable code provisions of the Corporate Governance Code, with the Audit Committee reviewing financial reporting and internal controls - The company has adopted the principles and complied with all applicable code provisions of the Corporate Governance Code set out in Appendix 15 of the GEM Listing Rules[109](index=109&type=chunk) - The Audit Committee has reviewed the accounting principles and practices adopted by the Group and this report with the company's management[110](index=110&type=chunk) - The condensed consolidated interim financial information for the six months ended June 30, 2025, is unaudited but has been reviewed by the Audit Committee[110](index=110&type=chunk)

[Company Profile](index=3&type=section&id=Company%20Profile) The company, registered in the Cayman Islands with headquarters in Shanghai, maintains a robust corporate governance structure with a diverse board and key committees [Board of Directors and Corporate Governance](index=3&type=section&id=Board%20of%20Directors%20and%20Corporate%20Governance) The company's board comprises executive, non-executive, and independent non-executive directors, with audit, remuneration, and nomination committees ensuring robust corporate governance, chaired by Mr. Zhang Jun, who also serves as Executive Chairman and Co-CEO - The Board of Directors includes Executive Director Mr. Zhang Jun (also Chairman, Executive Chairman, and Co-CEO), Non-executive Directors Ms. Zhang Shuman, Dr. Yang Qingli, Mr. Cao Hongbo, Dr. Fan Renda, and Independent Non-executive Directors Mr. Wang Tao, Mr. Huang Wenzong, and Mr. Shi Zheyan [5](index=5&type=chunk) - The company has established an Audit Committee (Chairman: Mr. Huang Wenzong), Remuneration Committee (Chairman: Mr. Wang Tao), and Nomination Committee (Chairman: Mr. Wang Tao) to strengthen corporate governance [5](index=5&type=chunk) [Company Basic Information](index=3&type=section&id=Company%20Basic%20Information) The company is registered in the Cayman Islands, headquartered in Shanghai, China, with a principal place of business in Hong Kong, and its shares are traded under stock code 1623 - The company's registered office is in the Cayman Islands, its headquarters are in Baoshan Industrial Park, Shanghai, China, and its principal place of business in Hong Kong is in Lee Garden One, Causeway Bay [6](index=6&type=chunk) - The company's stock code is **1623**, and its official website is www.hilonggroup.com [7](index=7&type=chunk) [Management Discussion and Analysis](index=4&type=section&id=Management%20Discussion%20and%20Analysis) The company experienced a revenue decline and net loss in H1 2025, driven by challenges in oilfield services, but saw strong growth in marine engineering, while actively pursuing strategic transformation, technological innovation, and international market expansion Major Financial Indicators for H1 2025 (RMB '000) | Indicator | H1 2025 (RMB '000) | H1 2024 (RMB '000) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Total Revenue | 2,322,537 | 2,465,641 | -5.8 | | Gross Profit | 401,445 | 578,304 | -30.6 | | Gross Profit Margin | 17.3% | 23.5% | -6.2pp | | Profit/(Loss) for the Period Attributable to Owners of the Company | (324,236) | 46,002 | N/A | | Basic Earnings/(Loss) Per Share (RMB Yuan) | (0.1911) | 0.0271 | N/A | [Financial Review](index=4&type=section&id=Financial%20Review) For the six months ended June 30, 2025, total revenue decreased by **5.8%** to **RMB 2,322.5 million**, driven by reduced income from oilfield equipment manufacturing and services, and oilfield services, resulting in a **RMB 324.2 million** loss attributable to owners [Revenue](index=4&type=section&id=Revenue) Total revenue for H1 2025 decreased by **5.8%** to **RMB 2,322.5 million**, with oilfield equipment manufacturing and services down **36.7%** due to reduced drill pipe sales, oilfield services down **8.6%** from lower drilling services and rig utilization, while marine engineering services surged **86.0%** from subsea pipeline and offshore platform projects Revenue by Business Segment (RMB '000) | Business Segment | H1 2025 (RMB '000) | H1 2024 (RMB '000) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Oilfield Equipment Manufacturing and Services | 716,643 | 1,132,464 | -36.7 | | Oilfield Services | 843,740 | 923,497 | -8.6 | | Marine Engineering Services | 762,154 | 409,680 | +86.0 | | **Total Revenue** | **2,322,537** | **2,465,641** | **-5.8** | Drill Pipe Sales Revenue Analysis (RMB '000) | Market | H1 2025 (RMB '000) | H1 2024 (RMB '000) | YoY Change (%) | | :--- | :--- | :--- | :--- | | International Market | 614,233 | 937,172 | -34.5 | | China Market | 61,096 | 133,197 | -54.1 | | **Total** | **675,329** | **1,070,369** | **-36.9** | - International drill pipe sales volume decreased by **27.5%** to **24,687 tons**, primarily due to reduced demand in the Middle East market caused by falling oil prices [10](index=10&type=chunk) - China market drill pipe sales volume decreased by **42.9%** to **4,134 tons**, mainly due to reduced demand from intense market competition [11](index=11&type=chunk) [Costs and Profits](index=6&type=section&id=Costs%20and%20Profits) Sales and services costs slightly increased by **1.8%** year-on-year, but gross profit significantly decreased by **30.6%**, with gross profit margin falling **6.2 percentage points** to **17.3%**; sales and marketing costs decreased by **31.2%**, administrative expenses increased by **4.9%**, and other net losses rose significantly due to vessel impairment losses Cost and Profit Indicators (RMB '000) | Indicator | H1 2025 (RMB '000) | H1 2024 (RMB '000) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Cost of Sales and Services | 1,921,092 | 1,887,337 | +1.8 | | Gross Profit | 401,445 | 578,304 | -30.6 | | Gross Profit Margin | 17.3% | 23.5% | -6.2pp | | Sales and Marketing Costs | 43,404 | 63,118 | -31.2 | | Administrative Expenses | 243,831 | 232,527 | +4.9 | | Other Losses – Net | (283,863) | (33,294) | N/A | | Finance Costs – Net | (101,012) | (129,031) | -21.7 | | (Loss)/Profit Before Income Tax | (283,439) | 100,079 | N/A | - Other net losses primarily reflect an impairment loss of **RMB 329.3 million** on vessels classified as held for sale, partially offset by a foreign exchange gain of **RMB 52.6 million** from the appreciation of the Ruble [17](index=17&type=chunk) - Net finance costs decreased by **21.7%**, mainly due to a **RMB 13.0 million** reduction in interest expenses on 2024 notes and bank borrowings, and a **RMB 14.1 million** increase in net foreign exchange gains from financing activities due to USD depreciation [18](index=18&type=chunk) [Assets, Liabilities and Liquidity](index=7&type=section&id=Assets%2C%20Liabilities%20and%20Liquidity) As of June 30, 2025, inventory increased to meet new overseas orders, while trade receivables turnover days rose, reflecting slower settlement efficiency in international markets; the current ratio improved to **126.7%**, but net borrowings remained at **RMB 1,895.8 million**, with a gearing ratio of **38.86%** Balance Sheet Key Indicators (RMB '000) | Indicator | June 30, 2025 | December 31, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Inventories | 1,236,730 | 1,095,842 | +12.9 | | Inventory Turnover Days | 110 | 112 | -1.8 | | Total Trade Receivables | 2,189,781 | 2,054,535 | +6.6 | | Trade Receivables Turnover Days | 166 | 154 | +7.8 | | Cash and Cash Equivalents | 583,362 | 721,631 | -19.2 | | Net Borrowings | 1,895,800 | 1,964,900 | -3.5 | | Current Ratio | 126.7% | 110.2% | +16.5pp | | Gearing Ratio | 38.86% | 37.40% | +1.46pp | - The increase in inventories primarily reflects increased reserves to meet new overseas market orders [22](index=22&type=chunk) - The increase in trade receivables turnover days primarily reflects a decrease and slowdown in settlement efficiency for certain oil and gas companies in the international market [24](index=24&type=chunk) - As of June 30, 2025, the company had pledged **17 drilling rigs** as collateral for the 2024 notes, located in Nigeria, Ecuador, Ukraine, Iraq, Brunei, and Pakistan [38](index=38&type=chunk) [Foreign Exchange and Employees](index=11&type=section&id=Foreign%20Exchange%20and%20Employees) The company primarily bears USD exchange rate risk, with USD-denominated revenue accounting for **55.9%** of total revenue in H1 2025, up from **41.2%** in H1 2024; as of June 30, 2025, total full-time employees were **2,359**, with employee costs of **RMB 294.8 million** - In H1 2025, the company's USD-denominated revenue accounted for **55.9%** of total revenue, an increase from **41.2%** in H1 2024, indicating increased exposure to USD exchange rate risk [39](index=39&type=chunk) Number of Employees by Function | Function | Number | | :--- | :--- | | Field Workers | 1,400 | | Administration | 336 | | Engineering and Technical Support | 414 | | R&D | 118 | | Sales, Marketing and After-sales Service | 71 | | Corporate Management | 20 | | **Total** | **2,359** | - Employee costs (excluding directors' emoluments) totaled **RMB 294.8 million** in H1 2025 [40](index=40&type=chunk) - The company adopted a share award scheme on September 11, 2023, but no share awards were granted for the six months ended June 30, 2025 [42](index=42&type=chunk) [Business Review](index=12&type=section&id=Business%20Review) In H1 2025, Hilong Group actively promoted technological innovation, talent development, and internationalization strategies, transforming into an asset-light, digital, and high-tech intelligent enterprise; despite a slight decrease in total revenue, various business segments made significant progress in market development and technological innovation, with marine engineering services achieving strong growth - The Group adheres to a strategy of **technology-driven innovation** and **intelligent, high-quality development**, achieving good results in key countries and regions such as the US, Canada, and the Middle East [43](index=43&type=chunk) - The Group strengthened cash flow management, implementing proactive financial measures such as enhanced accounts receivable and inventory management to improve overall operational efficiency [43](index=43&type=chunk) [Oilfield Equipment Manufacturing and Services](index=12&type=section&id=Oilfield%20Equipment%20Manufacturing%20and%20Services) This segment's revenue decreased by **36.7%** year-on-year to **RMB 716.6 million**; despite the revenue decline, the company continued to launch high-tech anti-sulfur drill pipe series, electronic tag drill pipes, and special connection drill pipes, while optimizing production processes and market layout, securing significant orders with high-end clients like Ensign, Precision Drilling, and ADNOC Drilling in the US, Canada, Middle East, and Southeast Asia markets - Launched high-tech anti-sulfur drill pipe series, electronic tag drill pipes and related full lifecycle management, Hilong special connections, high-strength U165 drill pipes for 10,000-meter ultra-deep wells, ultra-high torque drill pipes for extended reach horizontal wells, and wear-resistant drill pipes [44](index=44&type=chunk) - Achieved business breakthroughs in markets such as the US, Canada, the Middle East, and Southeast Asia, and established drill pipe production bases and new production lines in the Middle East and Central Asia [44](index=44&type=chunk) - Secured significant orders with major clients like Ensign and Precision Drilling, becoming a primary drill tool supplier for high-end customers; obtained long-term contracts with key clients such as ADNOC Drilling in the Middle East market [44](index=44&type=chunk) [Oilfield Services](index=13&type=section&id=Oilfield%20Services) This segment's revenue decreased by **8.6%** year-on-year to **RMB 843.7 million**; the company actively transitioned towards "asset-light and technology-led" operations, vigorously developing oilfield management and production enhancement solutions, expanding drilling turnkey projects and high-tech integrated general contracting businesses, achieving breakthroughs in turnkey operations in regions like Nigeria, and completing customized digital oilfield management solutions in Brazil, Iraq, and Libya - The Oilfield Services division closely aligns with the "asset-light and technology-led" transformation, comprehensively enhancing product and service capabilities, expanding new business models, and building integrated technical innovation service capabilities [46](index=46&type=chunk) - Achieved breakthroughs in turnkey operations in regions such as Nigeria, and completed customized digital oilfield management solutions in countries including Brazil, Iraq, and Libya [46](index=46&type=chunk) - Maintained stable development in environmental technical services such as drilling and workover mud, cuttings treatment, and well site restoration, as well as coiled tubing services, nano-oil displacement production enhancement technology, managed pressure drilling (MPD) technology, and integrated technical services like RSS directional/horizontal drilling [47](index=47&type=chunk) [Marine Engineering Services](index=14&type=section&id=Marine%20Engineering%20Services) This segment's revenue significantly increased by **86.0%** year-on-year to **RMB 762.2 million**; Hilong Marine Engineering made notable progress in basic management, operational capabilities, and business development, enhancing international and domestic project management and overseas project design and construction capabilities, actively developing into a specialized marine engineering company with EPCI integrated general contracting capabilities, and winning new projects in regions like Southeast Asia - Marine engineering services revenue increased by **86.0%** year-on-year, primarily reflecting increased revenue from subsea pipeline laying projects and offshore drilling platform construction projects [12](index=12&type=chunk)[48](index=48&type=chunk) - Hilong Marine Engineering is vigorously developing into a specialized marine engineering company with **EPCI integrated general contracting capabilities**, forming a full industry chain business capability [48](index=48&type=chunk) - Secured new bids for projects in regions such as Southeast Asia, completed key projects in Africa, and received high praise from clients for project delivery [48](index=48&type=chunk) [Technology R&D](index=15&type=section&id=Technology%20R%26D) Hilong Group is committed to driving corporate transformation through technological innovation and digitalization; in drill pipe products, it completed the development of large-diameter thick-walled HLU165 ultra-high strength drill pipes and high-pressure resistant special connections for marine risers, and promoted HLNST special threaded connections in the North American market; in oilfield services, it enhanced drilling turnkey technical service capabilities and promoted MPD controlled pressure drilling technology and nano-oil displacement production enhancement technology; in marine engineering, it initiated multiple technical research projects to improve offshore construction capabilities - Completed the development of large-diameter thick-walled **HLU165 ultra-high strength drill pipes** and high-pressure resistant special connections for marine risers, and initiated the development and construction of an information system in the drill pipe factory [49](index=49&type=chunk) - **HLNST special threaded connections** have achieved significant sales and gained recognition from high-end clients in the US and Canada; developed **HL135MS/HL130S higher steel grade anti-sulfur drill pipes**, and received high-end orders for electronic tag drill pipes [49](index=49&type=chunk) - The oilfield services segment enhanced its drilling turnkey technical service capabilities, strengthened the localization development and promotion of key equipment components for **Managed Pressure Drilling (MPD)**, and upgraded and promoted rotary steerable system technology and nano-oil displacement production enhancement technology [49](index=49&type=chunk) [Outlook](index=15&type=section&id=Outlook) Looking ahead to H2 2025, the company is optimistic about overall market improvement and will adhere to its high-tech development strategy, continuing to develop high-end clients and orders in the US, Middle East, Southeast Asia, and South America to increase international market share; each business segment will deepen product development, optimize business layout, enhance technical service capabilities, and actively explore new markets and businesses to strive for better performance - The Group will adhere to its high-tech development strategy, continuing to develop new high-end clients and secure high-end orders in countries and regions such as the US, Middle East, Southeast Asia, and South America, thereby increasing its international market share and brand service image [50](index=50&type=chunk) - The international drill pipe market will continue to promote high-value-added drill pipe products, deeply develop high-end demand in the Middle East, US, and Canada, and vigorously promote various high-strength, anti-sulfur, wear-resistant, and intelligent drill pipe products [51](index=51&type=chunk) - Oilfield services will stabilize existing drilling and workover rig operations, maintain rig utilization, strengthen the drilling turnkey technical team, and actively develop various businesses such as oilfield environmental protection, nano-enhanced oil recovery, drill tool repair, and trade services [52](index=52&type=chunk) - Marine engineering services will strengthen overseas personnel allocation, expand new clients, strive for more bidding opportunities, and focus on enhancing marine engineering digital delivery and management capabilities to continuously improve integrated general contracting service capabilities [53](index=53&type=chunk) [Other Significant Matters](index=18&type=section&id=Other%20Significant%20Matters) The company has met all resumption guidance and resumed share trading on July 8, 2025; in response to the auditor's disclaimer of opinion, the company is implementing an action plan to address related uncertainties; additionally, The Bank of New York Mellon, London Branch, has filed a winding-up petition against the company for its outstanding 2024 notes, with the hearing adjourned to October 27, 2025 - The company's shares resumed trading on the Stock Exchange at 9:00 a.m. on July 8, 2025, having met all resumption guidance [54](index=54&type=chunk) - The auditor issued a disclaimer of opinion on the consolidated financial statements for the year ended December 31, 2024, and the company has proposed an action plan to address the related uncertainties [55](index=55&type=chunk) - The Bank of New York Mellon, London Branch, filed a winding-up petition against the company for its unpaid **USD 379,135,000 9.75%** senior secured notes, with the hearing adjourned to October 27, 2025 [56](index=56&type=chunk) [Subsequent Events](index=18&type=section&id=Subsequent%20Events) On August 11, 2025, the company's indirect wholly-owned subsidiary entered into a Memorandum of Agreement with PT CAKRA BUANA RESOURCES ENERGI TBK, conditionally agreeing to sell the vessel "Hilong 106" for **USD 100 million**, of which **USD 75 million** will be received in cash - On August 11, 2025, the company's indirect wholly-owned subsidiary agreed to sell the vessel "Hilong 106" for **USD 100 million**, with **USD 75 million** to be received in cash and the remaining **USD 25 million** to be settled via promissory notes issued by the buyer [57](index=57&type=chunk) [Interim Condensed Consolidated Statement of Financial Position](index=18&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the company's total assets were **RMB 7,581.9 million**, a decrease from **RMB 8,077.7 million** as of December 31, 2024; total liabilities were **RMB 4,633.1 million**, and total equity was **RMB 2,948.8 million**, with a significant reduction in property, plant and equipment and the addition of **RMB 720.9 million** in assets classified as held for sale Balance Sheet Key Data (RMB '000) | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Property, Plant and Equipment | 1,302,145 | 2,366,346 | | Current Assets | 5,014,586 | 5,166,030 | | Assets Classified as Held for Sale | 720,903 | – | | **Total Assets** | **7,581,997** | **8,077,721** | | **Equity** | | | | Total Equity | 2,948,895 | 3,259,124 | | **Liabilities** | | | | Current Liabilities | 4,526,876 | 4,686,922 | | **Total Liabilities** | **4,633,102** | **4,818,597** | - Property, plant and equipment decreased from **RMB 2,366.3 million** as of December 31, 2024, to **RMB 1,302.1 million** as of June 30, 2025, primarily due to certain assets being classified as held for sale [58](index=58&type=chunk) - New assets classified as held for sale amounted to **RMB 720.9 million** [58](index=58&type=chunk) [Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=20&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the six months ended June 30, 2025, the company recorded a loss for the period of **RMB 324.8 million**, compared to a profit of **RMB 46.5 million** in the prior corresponding period; total comprehensive expense was **RMB 310.2 million**, and basic loss per share was **RMB 0.1911** Statement of Profit or Loss Key Data (RMB '000) | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Revenue | 2,322,537 | 2,465,641 | | Gross Profit | 401,445 | 578,304 | | Operating (Loss)/Profit | (182,427) | 229,110 | | (Loss)/Profit Before Income Tax | (283,439) | 100,079 | | Income Tax Expense | (41,431) | (53,523) | | (Loss)/Profit for the Period | (324,870) | 46,556 | | Total Comprehensive (Expense)/Income for the Period | (310,229) | (418) | | Basic (Loss)/Earnings Per Share (RMB Yuan) | (0.1911) | 0.0271 | - The loss for the period was primarily impacted by operating losses and income tax expense, contrasting with a profit in the prior corresponding period [60](index=60&type=chunk) - Foreign currency translation differences shifted from a loss of **RMB 46.9 million** in H1 2024 to a gain of **RMB 14.6 million** in H1 2025 [61](index=61&type=chunk) [Interim Condensed Consolidated Statement of Changes in Equity](index=22&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) For the six months ended June 30, 2025, total equity attributable to owners of the company decreased from **RMB 3,263.9 million** at the beginning of the period to **RMB 2,954.3 million** at the end, primarily due to a loss for the period of **RMB 324.2 million**; non-controlling interests also recorded a loss Summary of Changes in Equity (RMB '000) | Indicator | January 1, 2025 | Loss for the Period | Other Comprehensive Income/(Expense) | June 30, 2025 | | :--- | :--- | :--- | :--- | :--- | | Ordinary Shares | 141,976 | – | – | 141,976 | | Other Reserves | 1,262,126 | – | – | 1,262,126 | | Foreign Currency Translation Differences | (459,721) | – | 14,655 | (445,066) | | Retained Earnings | 2,319,537 | (324,236) | – | 1,995,301 | | **Total Attributable to Owners of the Company** | **3,263,918** | **(324,236)** | **14,655** | **2,954,337** | | Non-controlling Interests | (4,794) | (634) | (14) | (5,442) | | **Total Equity** | **3,259,124** | **(324,870)** | **14,641** | **2,948,895** | - A loss for the period of **RMB 324.2 million** was the primary reason for the decrease in equity attributable to owners of the company [62](index=62&type=chunk) [Interim Condensed Consolidated Statement of Cash Flows](index=23&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) For the six months ended June 30, 2025, net cash generated from operating activities was **RMB 182.5 million**, a significant improvement from net cash used of **RMB 90.4 million** in the prior corresponding period; both investing and financing activities resulted in net cash outflows, leading to a net decrease in cash and cash equivalents of **RMB 141.4 million**, with an ending balance of **RMB 583.3 million** Cash Flow Statement Key Data (RMB '000) | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Net Cash Generated From/(Used In) Operating Activities | 182,574 | (90,403) | | Net Cash Used In Investing Activities | (107,867) | (76,068) | | Net Cash Used In Financing Activities | (216,142) | (71,980) | | Net Decrease in Cash and Cash Equivalents | (141,435) | (238,451) | | Cash and Cash Equivalents at End of Period | 583,362 | 610,085 | - Operating cash flow shifted from a net outflow to a net inflow compared to the prior period, indicating improved operational efficiency [63](index=63&type=chunk) - Net cash outflow from investing activities increased, primarily due to higher expenditures on property, plant and equipment [63](index=63&type=chunk) - Net cash outflow from financing activities significantly increased, mainly due to larger repayments of borrowings [63](index=63&type=chunk) [Notes to the Interim Condensed Consolidated Financial Information](index=24&type=section&id=Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Information) This section details the company's operational context, accounting policies, financial risk management, segment performance, asset and liability specifics, including the default on 2024 notes, and related party transactions [Basic Information and Basis of Preparation](index=25&type=section&id=Basic%20Information%20and%20Basis%20of%20Preparation) Hilong Holding Limited primarily engages in oil and gas equipment manufacturing and distribution, and provides oilfield, marine engineering, and marine design services; this interim condensed consolidated financial information is unaudited and prepared in accordance with Hong Kong Accounting Standard 34 and the Listing Rules, adopting new and revised standards effective for the current accounting period - The Group is principally engaged in the manufacturing and distribution of oil and gas equipment, and the provision of oilfield, marine engineering, and marine design services [64](index=64&type=chunk) - This interim condensed consolidated financial information is unaudited and has been prepared in accordance with Hong Kong Accounting Standard 34 issued by the Hong Kong Institute of Certified Public Accountants and the applicable disclosure provisions of the Listing Rules [66](index=66&type=chunk)[67](index=67&type=chunk) [Significant Accounting Policies](index=26&type=section&id=Significant%20Accounting%20Policies) Revisions to Hong Kong Financial Reporting Standards issued by the HKICPA were first applied during this period but had no significant impact on financial position or performance; significant uncertainties regarding the company's going concern exist, including the failure to repay the 2024 notes and accrued interest; management has formulated several plans to mitigate liquidity pressure, including seeking restructuring, new financing, accelerating receivables collection, reducing operating costs, and selling vessels - For the six months ended June 30, 2025, the Group incurred a net loss of **RMB 324,870,000**, and current liabilities included borrowings of **RMB 2,479,217,000** repayable within 12 months [69](index=69&type=chunk) - The Group failed to repay the 2024 notes and accrued interest on their due date of November 18, 2024, constituting an event of default [69](index=69&type=chunk) - Management has formulated plans including actively communicating with 2024 noteholders to seek restructuring, seeking new financing sources (existing bank loans have been extended), accelerating the recovery of trade and other receivables, reducing operating costs, and completing vessel sales to improve cash flow [70](index=70&type=chunk)[71](index=71&type=chunk)[72](index=72&type=chunk) - Non-current assets are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use, and they are available for immediate sale in their present condition [74](index=74&type=chunk)[75](index=75&type=chunk) [Accounting Estimates and Financial Risk Management](index=29&type=section&id=Accounting%20Estimates%20and%20Financial%20Risk%20Management) The preparation of interim financial data involves management's judgments, estimates, and assumptions; the company faces market risks (foreign exchange, interest rates), credit risk, and liquidity risk; management manages liquidity risk by monitoring rolling forecasts of liquidity reserves and cash and cash equivalents, and credit risk by assessing client creditworthiness, limiting credit periods, and regularly reviewing receivables; fair value estimates for financial instruments use a three-level hierarchy - The Group's activities are exposed to market risk (including foreign exchange risk, fair value interest rate risk, and cash flow interest rate risk), credit risk, and liquidity risk [78](index=78&type=chunk) - Management manages liquidity risk by monitoring rolling forecasts of liquidity reserves and cash and cash equivalents, and expects to fund future cash flow requirements through internal operating cash flows, collection of receivables, borrowings, and issuance of debt/equity instruments [79](index=79&type=chunk) - The Group manages credit risk by assessing clients' financial conditions, the likelihood of obtaining guarantees, credit history, and market conditions, and regularly monitors client credit records [81](index=81&type=chunk) Financial Instruments Measured at Fair Value (RMB '000) | Level | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Level 3 Financial Assets | 156,822 | 212,583 | [Segment Information](index=32&type=section&id=Segment%20Information) The Group's operations are primarily divided into three business segments: oilfield equipment manufacturing and services, oilfield services, and marine engineering services, operating in six major geographical regions globally; in H1 2025, revenue from oilfield equipment manufacturing and services and oilfield services decreased, while marine engineering services revenue significantly increased; segment assets and liabilities are allocated, but finance income, finance costs, and income tax expense are not included in segment performance measurement - The Group's operations are primarily composed of three business segments: oilfield equipment manufacturing and services, oilfield services, and marine engineering services [92](index=92&type=chunk) Revenue by Business Segment (RMB '000) | Business Segment | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Oilfield Equipment Manufacturing and Services | 716,643 | 1,132,464 | | Oilfield Services | 843,740 | 923,497 | | Marine Engineering Services | 762,154 | 409,680 | | **Total** | **2,322,537** | **2,465,641** | Revenue by Geographical Region (RMB '000) | Region | H1 2025 | H1 2024 | | :--- | :--- | :--- | | China (Place of Registration) | 280,567 | 282,255 | | Russia, Central Asia and Europe | 308,457 | 543,473 | | North and South America | 324,313 | 344,795 | | Middle East | 444,767 | 787,353 | | Africa | 526,378 | 202,381 | | South and Southeast Asia | 438,055 | 305,384 | | **Total** | **2,322,537** | **2,465,641** | - In H1 2025, revenue from the Africa region significantly increased, while revenue from the Middle East, Russia, Central Asia, and Europe regions decreased [99](index=99&type=chunk) [Property, Plant and Equipment, Right-of-Use Assets and Intangible Assets](index=37&type=section&id=Property%2C%20Plant%20and%20Equipment%2C%20Right-of-Use%20Assets%20and%20Intangible%20Assets) During the period, the Group acquired property, plant and equipment amounting to **RMB 159.4 million**; property, plant and equipment with a carrying amount of **RMB 1,050.1 million** were classified as assets held for sale, resulting in an impairment loss of **RMB 329.2 million** - Property, plant and equipment amounting to **RMB 159,412,000** were acquired during the period [102](index=102&type=chunk) - Property, plant and equipment with a carrying amount of **RMB 1,050,190,000** were classified as assets held for sale, and an impairment loss of **RMB 329,287,000** was recognized [103](index=103&type=chunk)[117](index=117&type=chunk) [Financial Assets and Financial Liabilities](index=38&type=section&id=Financial%20Assets%20and%20Financial%20Liabilities) As of June 30, 2025, the Group's total financial assets were **RMB 3,431.8 million**, and total financial liabilities were **RMB 4,349.1 million**; total trade receivables amounted to **RMB 2,189.7 million**, of which **RMB 22.9 million** were pledged for borrowings; total borrowings were **RMB 2,479.2 million**, including **RMB 2,251.7 million** for the 2024 notes which are in default; total trade payables were **RMB 1,249.0 million** Summary of Financial Assets and Financial Liabilities (RMB '000) | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Financial Assets** | | | | Financial Assets at Fair Value Through Other Comprehensive Income | 156,822 | 212,583 | | Financial Assets at Amortized Cost | 3,275,066 | 3,387,128 | | **Total Financial Assets** | **3,431,888** | **3,599,711** | | **Financial Liabilities** | | | | Borrowings | 2,479,217 | 2,686,464 | | Trade and Other Payables | 1,849,283 | 1,737,743 | | Lease Liabilities | 20,627 | 27,326 | | **Total Financial Liabilities** | **4,349,127** | **4,451,533** | - Total trade receivables amounted to **RMB 2,189.7 million**, of which **RMB 22.9 million** were pledged to secure borrowings from financial institutions [105](index=105&type=chunk)[106](index=106&type=chunk) - The outstanding principal of the 2024 notes was **USD 314,546,000**, due for repayment on November 18, 2024, but remained unpaid as of June 30, 2025, constituting an event of default [110](index=110&type=chunk)[111](index=111&type=chunk) - As of June 30, 2025, accrued interest on the 2024 notes amounted to **RMB 245,120,000**, which has been included in interest payable [111](index=111&type=chunk) [Assets Classified as Held for Sale](index=43&type=section&id=Assets%20Classified%20as%20Held%20for%20Sale) The Group's management resolved to sell the vessel "Hilong 106" within the marine engineering services segment to align with strategic transformation and generate immediate cash flow; the vessel's carrying amount of **RMB 1,050.1 million** was written down to its fair value less costs to sell of **RMB 720.9 million**, with an impairment loss of **RMB 329.2 million** recognized in other net losses; subsequently, the company signed a Memorandum of Agreement with a buyer to sell the vessel for **USD 100 million** - The Group resolved to sell a vessel within the marine engineering services segment to align with its strategic transformation and reduce operational reliance on the vessel, while generating immediate cash flow [116](index=116&type=chunk) - The vessel's carrying amount of **RMB 1,050,190,000** was written down to its fair value less costs to sell of **RMB 720,903,000**, and an impairment loss of **RMB 329,287,000** was recognized in "Other losses – net" [117](index=117&type=chunk)[118](index=118&type=chunk) - Subsequently, the Group entered into a Memorandum of Agreement with an independent third-party buyer to sell the vessel for **USD 100 million**, of which **USD 75 million** will be received in cash [119](index=119&type=chunk) [Ordinary Shares and Other Reserves](index=44&type=section&id=Ordinary%20Shares%20and%20Other%20Reserves) As of June 30, 2025, the company had **1,696,438,600** issued and fully paid ordinary shares, with a par value of **HKD 0.1** per share, equivalent to **RMB 141,975,506**; total other reserves amounted to **RMB 1,262.1 million**, including statutory reserves, merger reserves, and share premium Ordinary Share Information | Indicator | Quantity/Amount | | :--- | :--- | | Number of Ordinary Shares | 1,696,438,600 shares | | Par Value of Ordinary Shares | HKD 0.1/share | | Equivalent Par Value | RMB 141,975,506 | Composition of Other Reserves (RMB '000) | Reserve Type | Amount | | :--- | :--- | | Statutory Reserve | 140,023 | | Merger Reserve | (496) | | Share Premium | 1,175,144 | | Reserve for Financial Assets at Fair Value Through Other Comprehensive Income | (2) | | Capital Redemption Reserve | 702 | | Capital Reserve | (53,245) | | **Total** | **1,262,126** | [Equity-settled Share-based Payment Arrangements](index=44&type=section&id=Equity-settled%20Share-based%20Payment%20Arrangements) The company adopted a share award scheme on September 11, 2023, to recognize employee contributions, retain talent, and attract new talent; the scheme is valid for **10 years**, with a maximum total number of awarded shares not exceeding **10%** of the company's issued share capital; as of June 30, 2025, no share awards were granted - The company adopted a share award scheme on September 11, 2023, to recognize and reward the contributions of eligible participants, and to retain and attract talent [122](index=122&type=chunk)[155](index=155&type=chunk) - The scheme is valid for **10 years**, with the maximum total number of awarded shares not exceeding **10%** of the company's issued share capital as of the adoption date (i.e., **169,643,860 shares**) [122](index=122&type=chunk)[157](index=157&type=chunk)[158](index=158&type=chunk) - As of June 30, 2025, no share awards were granted to any directors or employees [122](index=122&type=chunk)[162](index=162&type=chunk) [Other Income and Losses](index=45&type=section&id=Other%20Income%20and%20Losses) In H1 2025, other income primarily derived from government grants, totaling **RMB 8.0 million**; other net losses amounted to **RMB 283.8 million**, mainly due to an impairment loss of **RMB 329.2 million** on non-current assets classified as held for sale, partially offset by net foreign exchange gains of **RMB 52.5 million** Other Income (RMB '000) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Other Government Grants | 7,450 | 7,806 | | Release of Deferred Government Grants | 645 | 743 | | **Total** | **8,095** | **8,549** | Other Losses – Net (RMB '000) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Impairment Loss on Property, Plant and Equipment | (6,948) | – | | Impairment Loss on Non-current Assets Classified as Held for Sale | (329,287) | – | | Gain/(Loss) on Disposal of Property, Plant and Equipment – Net | 428 | (6,094) | | Net Foreign Exchange Gain/(Loss) | 52,567 | (28,737) | | Others | (623) | 1,537 | | **Total** | **(283,863)** | **(33,294)** | - Other net losses significantly increased, primarily due to the recognition of a substantial impairment loss on non-current assets classified as held for sale [125](index=125&type=chunk) [Finance Costs and Income Tax Expense](index=46&type=section&id=Finance%20Costs%20and%20Income%20Tax%20Expense) Net finance costs for H1 2025 were **RMB 101.0 million**, a decrease from **RMB 129.0 million** in the prior corresponding period, mainly due to reduced interest expenses on borrowings and net foreign exchange gains; income tax expense was **RMB 41.4 million**, with an effective tax rate of approximately **-14.6%**, primarily reflecting an unbalanced profit distribution among subsidiaries and increased tax losses with unrecognised deferred tax Finance Costs – Net (RMB '000) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Interest Income from Bank Deposits | 7,886 | 7,243 | | Interest Expense on 2024 Notes and Bank and Other Borrowings | (117,926) | (130,877) | | Net Foreign Exchange Gain/(Loss) | 9,440 | (4,655) | | Interest Expense on Lease Liabilities | (412) | (742) | | **Finance Costs – Net** | **(101,012)** | **(129,031)** | Income Tax Expense (RMB '000) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Current Income Tax | 30,377 | 67,567 | | Deferred Income Tax | 11,054 | (14,044) | | **Income Tax Expense** | **41,431** | **53,523** | - The effective tax rate for H1 2025 was approximately **-14.6%**, a significant decrease from **53.5%** in the prior corresponding period, primarily reflecting an unbalanced profit distribution among subsidiaries and increased tax losses of subsidiaries for which deferred tax was not recognized [20](index=20&type=chunk)[129](index=129&type=chunk) [Earnings/(Loss) Per Share and Dividends](index=48&type=section&id=Earnings%2F%28Loss%29%20Per%20Share%20and%20Dividends) For the six months ended June 30, 2025, basic loss per share attributable to owners of the company was **RMB 0.1911**; diluted loss per share was not presented as there were no potential ordinary shares outstanding during the period; the Board resolved not to declare an interim dividend Earnings/(Loss) Per Share | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | (Loss)/Profit Attributable to Owners of the Company (RMB '000) | (324,236) | 46,002 | | Weighted Average Number of Ordinary Shares (Thousand Shares) | 1,696,439 | 1,696,439 | | Basic (Loss)/Earnings Per Share (RMB per Share) | (0.1911) | 0.0271 | - Diluted (loss)/earnings per share was not presented for the six months ended June 30, 2025, as there were no potential ordinary shares outstanding during the period [136](index=136&type=chunk) - The Board resolved not to declare an interim dividend for the six months ended June 30, 2025 [138](index=138&type=chunk) [Significant Related Party Transactions and Balances](index=49&type=section&id=Significant%20Related%20Party%20Transactions%20and%20Balances) The Group has several related party transactions and balances with its controlling shareholder, Mr. Zhang Jun, and entities controlled or jointly controlled by him; in H1 2025, sales of goods or services to related parties amounted to **RMB 8.4 million**, and purchases of goods or services from related parties amounted to **RMB 117.8 million**; as of the period end, trade receivables from related parties were **RMB 26.5 million**, and trade payables to related parties were **RMB 140.4 million**; some bank financing is guaranteed by Mr. Zhang Jun and Hilong Petroleum - The Group's immediate and ultimate parent company is Hilong Group Limited, and the ultimate controlling shareholder is Mr. Zhang Jun [139](index=139&type=chunk) Transactions with Related Parties (RMB '000) | Transaction Type | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Sales of Goods or Services | 8,454 | 73,758 | | Purchases of Goods or Services | 117,831 | 111,102 | | Short-term Lease Expenses | 11,191 | 10,020 | | Interest Expense on Lease Liabilities | 122 | 203 | | Lease Income and Utilities Income | 6,962 | 6,711 | Balances with Related Parties (RMB '000) | Balance Type | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Trade Receivables from Related Parties (Net) | 23,764 | 24,113 | | Other Receivables from Related Parties (Net) | 177,710 | 194,466 | | Lease Liabilities to Related Parties | 3,962 | 5,721 | | Trade Payables to Related Parties | 140,453 | 201,683 | | Other Payables to Related Parties | 101,030 | 102,855 | - Certain bank financing of the Group is guaranteed by Mr. Zhang Jun and Hilong Petroleum [141](index=141&type=chunk) [Other Information](index=52&type=section&id=Other%20Information) This section covers changes in directors' information, disclosures of interests for directors and major shareholders, adherence to corporate governance codes, and the absence of listed securities transactions or interim dividend declarations [Changes in Directors' Information](index=52&type=section&id=Changes%20in%20Directors'%20Information) Since the publication date of the 2024 annual report, Non-executive Director Dr. Fan Renda and Independent Non-executive Director Mr. Huang Wenzong have ceased to serve as independent non-executive directors of certain other listed companies - Non-executive Director Dr. Fan Renda ceased to be an independent non-executive director of CITIC Resources Holdings Limited effective March 18, 2025, and ceased to be an independent non-executive director of Tongfang Konta Technology and Tongfang Guoxin Electronics on June 17, 2025, and June 20, 2025, respectively [151](index=151&type=chunk) - Independent Non-executive Director Mr. Huang Wenzong ceased to be an independent non-executive director of Qizhi Technology (Cayman) Co., Ltd. effective June 4, 2025 [151](index=151&type=chunk) [Disclosure of Interests](index=53&type=section&id=Disclosure%20of%20Interests) As of June 30, 2025, directors and chief executives held interests in the company's shares, with Mr. Zhang Jun holding approximately **48.868%** and Ms. Zhang Shuman holding approximately **1.473%**; major shareholder Hilong Group Limited held **42.17%** of shares; the company's 2023 share award scheme aims to incentivize employees, but no awards were granted as of the period end Directors' Long Positions in the Company's Shares | Director Name | Capacity | Number of Shares Interested | Approximate Percentage of Company's Issued Share Capital | | :--- | :--- | :--- | :--- | | Mr. Zhang Jun | Founder/Beneficiary/Controlled Corporation Interest/Beneficial Owner | 829,021,800 | 48.868% | | Ms. Zhang Shuman | Controlled Corporation Interest/Beneficial Owner | 24,992,000 | 1.473% | | Mr. Cao Hongbo | Beneficial Owner | 1,708,000 | 0.101% | | Mr. Huang Wenzong | Beneficial Owner | 1,288,000 | 0.076% | | Dr. Yang Qingli | Spouse's Interest | 77,000 | 0.005% | | Mr. Gao Zhihai | Beneficial Owner | 1,395,000 | 0.082% | Major Shareholders' Long Positions in the Company's Shares | Name of Major Shareholder | Capacity | Number of Shares Interested | Approximate Percentage of Company's Issued Share Capital | | :--- | :--- | :--- | :--- | | Hilong Group Limited | Beneficial Owner | 715,461,000 | 42.17% | | SCTS Capital Pte Ltd. | Nominee | 827,761,800 | 48.79% | | Standard Chartered Trust (Singapore) Limited | Trustee | 827,761,800 | 48.79% | | Ms. Gao Xia | Spouse's Interest | 829,021,800 | 48.87% | - The maximum total number of awarded shares under the 2023 award scheme does not exceed **10%** of the company's issued share capital as of the adoption date (i.e., **169,643,860 shares**) [158](index=158&type=chunk) [Corporate Governance and Securities Transactions](index=56&type=section&id=Corporate%20Governance%20and%20Securities%20Transactions) The company complied with the Corporate Governance Code during the interim period, although the roles of Chairman and Chief Executive Officer are combined in Mr. Zhang Jun, an arrangement the company believes enhances strategic planning efficiency with sufficient safeguards; all directors confirmed compliance with the Model Code for Securities Transactions by Directors; the Audit Committee reviewed the interim results and report - The company complied with the Corporate Governance Code, except for the combined roles of Chairman and Chief Executive Officer held by Mr. Zhang Jun, an arrangement the company believes enhances overall strategic planning efficiency, with sufficient safeguards provided by the balanced composition of the Board and its committees [163](index=163&type=chunk) - All directors confirmed compliance with the Model Code for Securities Transactions by Directors throughout the interim period [164](index=164&type=chunk) - The company's Audit Committee reviewed the interim results and interim report for the period [165](index=165&type=chunk) [Listed Securities and Dividends](index=57&type=section&id=Listed%20Securities%20and%20Dividends) During the interim period, neither the company nor any of its subsidiaries purchased, sold, or redeemed any listed securities, nor did they hold any treasury shares; the Board resolved not to declare an interim dividend - During the interim period, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities, nor did they hold any treasury shares [166](index=166&type=chunk)[167](index=167&type=chunk) - The Board resolved not to declare an interim dividend [168](index=168&type=chunk)

公司資料 2 主要會計數據和財務指標 6 未經審計中期財務報表 合併資產負債表 7 母公司資產負債表 9 合併利潤表 10 母公司利潤表 11 合併現金流量表 12 母公司現金流量表 13 合併所有者權益變動表 14 母公司所有者權益變動表 15 財務報表附註 16 經營情況討論與分析 110 企業管治及其他資料 123 詞彙 127 目錄 | 法定名稱 | 浙江世寶股份有限公司 | | --- | --- | | | Zhejiang Shibao Company Limited* | | 董事會 | 執行董事 | | | 張寶義先生 （副董事長兼總經理） | | | 湯浩瀚先生 （副董事長兼副總經理） | | | 張蘭君女士 （財務負責人） | | | （副總經理） 周 裕先生 | | | 非執行董事 | | | 張世權先生 （董事長） | | | 張世忠先生 | | | 獨立非執行董事 | | | 龔俊傑先生 | | | 閔海濤先生 | | | 徐晋誠先生 | | 監事 | 杜 敏先生 | | | 劉 剛先生 | | | 吳琅平先生 | | | 馮 燕女士 | | | 張治龍先生 | | 高級管理層 | ...

[Abbreviations](index=3&type=section&id=Abbreviations) This section lists the key abbreviations used throughout the report - Key abbreviations used in the report include 'Board', 'Company', 'Directors', 'Group', 'Listing Rules', 'China', 'SFO', 'Shares', 'Shareholders', 'Stock Exchange', 'HK$', 'RMB', 'US$', and '%'[5](index=5&type=chunk) [Corporate Information](index=4&type=section&id=Corporate%20Information) This section provides an overview of the company's fundamental corporate details and governance structure [Board of Directors](index=4&type=section&id=BOARD%20OF%20DIRECTORS) The Board of Directors experienced multiple changes during the reporting period, including appointments and resignations of executive, non-executive, and independent non-executive directors, with Ms. Wang Jingyu appointed as Chairperson on September 3, 2025, and Mr. Jiang Qinghui resigning as Chairperson on the same day - Ms. Wang Jingyu was appointed Executive Director and Chairperson on **September 3, 2025**[7](index=7&type=chunk)[9](index=9&type=chunk) - Mr. Weng Zutian serves as the Chief Executive Officer[7](index=7&type=chunk)[9](index=9&type=chunk) - Mr. Jiang Qinghui and Mr. Li Zhonghai resigned as Executive Directors on **September 3, 2025**[7](index=7&type=chunk)[9](index=9&type=chunk) - Ms. Hu Xinqi and Ms. Huang Tianying were appointed Independent Non-executive Directors on **August 22, 2025**[7](index=7&type=chunk)[9](index=9&type=chunk) [Audit Committee](index=4&type=section&id=AUDIT%20COMMITTEE) The Audit Committee's membership changed during the reporting period, with Ms. Hu Xinqi appointed as Chairperson on August 22, 2025, while Mr. Guo Jianxiong and Mr. Chen Zhuohao ceased to be chairpersons on August 8, 2025, and February 28, 2025, respectively - Ms. Hu Xinqi was appointed Chairperson of the Audit Committee on **August 22, 2025**[8](index=8&type=chunk)[9](index=9&type=chunk) - Mr. Guo Jianxiong ceased to be Chairperson of the Audit Committee on **August 8, 2025**[8](index=8&type=chunk)[9](index=9&type=chunk) [Remuneration Committee](index=4&type=section&id=REMUNERATION%20COMMITTEE) The Remuneration Committee's membership changed during the reporting period, with Ms. Huang Tianying appointed as Chairperson on August 22, 2025, while Mr. Weng Zutian and Mr. Chen Zhuohao ceased to be chairpersons on August 22, 2025, and February 28, 2025, respectively - Ms. Huang Tianying was appointed Chairperson of the Remuneration Committee on **August 22, 2025**[8](index=8&type=chunk)[9](index=9&type=chunk) - Mr. Weng Zutian ceased to be Chairperson of the Remuneration Committee on **August 22, 2025**[8](index=8&type=chunk)[9](index=9&type=chunk) [Nomination Committee](index=5&type=section&id=NOMINATION%20COMMITTEE) The Nomination Committee's membership changed during the reporting period, with Ms. Huang Tianying re-designated as Chairperson on September 3, 2025, and Mr. Jiang Qinghui ceasing to be Chairperson on the same day - Ms. Huang Tianying was re-designated as Chairperson of the Nomination Committee on **September 3, 2025**[10](index=10&type=chunk)[11](index=11&type=chunk) - Mr. Jiang Qinghui ceased to be Chairperson of the Nomination Committee on **September 3, 2025**[10](index=10&type=chunk)[11](index=11&type=chunk) [Company Secretary](index=5&type=section&id=COMPANY%20SECRETARY) Ms. Yu Yayun was appointed Company Secretary on July 7, 2025, while Mr. Lin Guanhui resigned on the same day - Ms. Yu Yayun was appointed Company Secretary on **July 7, 2025**[10](index=10&type=chunk)[12](index=12&type=chunk) - Mr. Lin Guanhui resigned as Company Secretary on **July 7, 2025**[10](index=10&type=chunk)[12](index=12&type=chunk) [Other Corporate Information](index=5&type=section&id=Other%20Corporate%20Information) The Company's shares are listed on the Hong Kong Stock Exchange with stock code 209, its registered office is in Bermuda, and its principal place of business in Hong Kong is at Shun Tak Centre; key banks include HSBC, Bank of Communications Hong Kong Branch, and China Guangfa Bank Zhongshan Branch, with Tianjian International Certified Public Accountants Limited as auditor - Shares are listed on the Hong Kong Stock Exchange, stock code **209**[11](index=11&type=chunk)[12](index=12&type=chunk) - The registered office is located at Clarendon House, Bermuda[11](index=11&type=chunk)[12](index=12&type=chunk) - The principal place of business in Hong Kong is Unit 907B, 9th Floor, China Merchants Tower, Shun Tak Centre, 168–200 Connaught Road Central, Hong Kong[11](index=11&type=chunk)[12](index=12&type=chunk) - The auditor is Tianjian International Certified Public Accountants Limited[14](index=14&type=chunk)[15](index=15&type=chunk) [Management Discussion and Analysis](index=7&type=section&id=Management%20Discussion%20and%20Analysis) This section provides an overview of the Group's business operations, financial performance, and future outlook [Business Review](index=7&type=section&id=BUSINESS%20REVIEW) The Group primarily engages in toy manufacturing and trading, as well as agricultural product cultivation and sales; for the interim period ended June 30, 2025, the toy business continued to face challenges due to US tariffs and rising labor costs in China, leading to decreased order volume and increased gross loss, while the agricultural products business generated no revenue - The Group's principal businesses are **toy manufacturing and trading**, and **agricultural product cultivation and sales**[16](index=16&type=chunk)[21](index=21&type=chunk) - The toy business is affected by **US tariffs on China** and **rising minimum wage and social insurance costs in China**, leading to a continuous decline in order volume and pressure on profit margins[16](index=16&type=chunk)[17](index=17&type=chunk)[21](index=21&type=chunk) - For the interim period ended June 30, 2025, the agricultural product cultivation and sales business generated **no revenue** (2024: HK$1.3 million)[18](index=18&type=chunk)[21](index=21&type=chunk) Key Financial Performance (Six Months Ended June 30) | Metric | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | Change (HK$ Thousand) | Change Rate | Reference Chunk | | :--- | :--- | :--- | :--- | :--- | :--- | | Toy Segment Revenue | 148,400 | 189,800 | (41,400) | -21.8% | [20, 23] | | Agricultural Products Segment Revenue | 0 | 1,300 | (1,300) | -100% | [18, 21, 26, 32] | | Gross Loss/Profit | (10,000) | 4,100 | (14,100) | -343.9% | [18, 22] | | Loss for the Period | (38,300) | (26,700) | (11,600) | +43.4% | [19, 22] | [Financial Review](index=8&type=section&id=FINANCIAL%20REVIEW) The Group's financial position shows an increase in net current liabilities, a decrease in cash and cash equivalents, an expanded capital deficiency, and a higher gearing ratio; to improve its financial health, the Group has taken measures including extending bank financing maturity dates, implementing cost-saving initiatives, and exploring other financing arrangements, while foreign currency risk is considered not significant and certain assets are pledged for bank financing, with no material contingent liabilities currently [Liquidity, Financial Resources and Capital Structure](index=8&type=section&id=Liquidity,%20Financial%20Resources%20and%20Capital%20Structure) As of June 30, 2025, the Group's net current liabilities, total borrowings, and capital deficiency attributable to owners of the Company all increased, with a deterioration in the current ratio and gearing ratio; to address funding pressure, the Company completed a share subscription in January 2025, raising approximately HK$1.2 million in net proceeds for working capital Liquidity and Capital Structure Metrics | Metric | June 30, 2025 (HK$ Million) | December 31, 2024 (HK$ Million) | Change (HK$ Million) | Change Rate | Reference Chunk | | :--- | :--- | :--- | :--- | :--- | :--- | | Net Current Liabilities | 253.3 | 220.3 | 33.0 | +15.0% | [27, 33] | | Cash and Cash Equivalents | 34.1 | 55.3 | (21.2) | -38.3% | [27, 33] | | Current Ratio | 0.47 times | 0.54 times | (0.07) | -13.0% | [27, 33] | | Total Loans | 229.8 | 217.1 | 12.7 | +5.8% | [28, 33] | | Capital Deficiency Attributable to Owners of the Company | 173.8 | 139.0 | 34.8 | +25.0% | [29, 33] | | Gearing Ratio | 170% | 136.7% | 33.3% | +24.4% | [29, 33] |

2025 INTERIM 2025 報告 中期 REPORT 目錄 3 公司資料 4 管理層討論及展望 16 簡明綜合損益及其他全面收益表 17 簡明綜合財務狀況表 18 簡明綜合權益變動表 20 簡明綜合現金流量表 21 簡明綜合財務報表附註 41 其他資料 於本中期報告內，除文義另有所指外，下列簡稱具有以下涵義： | 「董事會」 | 指 | 董事會 | | --- | --- | --- | | 「本公司」 | 指 | 長盈集團（控股）有限公司 | | 「董事」 | 指 | 本公司之董事 | | 「本集團」 | 指 | 本公司及其附屬公司 | | 「香港聯交所」 | 指 | 香港聯合交易所有限公司 | | 「上市規則」 | 指 | 香港聯交所證券上市規則 | | 「標準守則」 | 指 | 上市規則附錄C3所載上市發行人董事進行證券交易之標準守則 | | 「證券及期貨條例」 | 指 | 香港法例第571章《證券及期貨條例》 | | 「加元」 | 指 | 加拿大元 | | 「港元」及「港仙」 | 指 | 港元及港仙 | | 「紐元」 | 指 | 紐西蘭元 | | 「美元」 | 指 | 美元 | | 「%」 | ...

2025 目 錄 Contents | 公司資料 | Corporate Information | 2 | | --- | --- | --- | | 集團簡介 | Corporate Profile | 5 | | 管理層討論及分析 | Management Discussion and Analysis | 7 | | 企業管治及其他資料 | Corporate Governance and Other Information | 17 | | 獨立審閱報告 | Independent Review Report | 22 | | 中期簡明綜合損益及 | Interim Condensed Consolidated Statement of Profit or Loss | 25 | | 其他全面收益表 | and Other Comprehensive Income | | | 中期簡明綜合財務狀況表 | Interim Condensed Consolidated Statement of Financial Position | 26 | | 中期簡明綜合權益變動表 | Interim Conde ...

[Corporate Information](index=3&type=section&id=Corporate%20Information) [Directors](index=3&type=section&id=DIRECTORS) The company's board of directors comprises executive directors Mr. Ng Chi Chiu (Chairman and Chief Executive Officer) and Ms. Chiu Hoi Yin, and independent non-executive directors Dr. Ho Ka Yan, Mr. Yip Kit Chau, and Mr. Law Hung Wai (CPA) - Executive Directors include Mr. Ng Chi Chiu (Chairman and Chief Executive Officer) and Ms. Chiu Hoi Yin[3](index=3&type=chunk) - Independent Non-executive Directors are Dr. Ho Ka Yan, Mr. Yip Kit Chau, and Mr. Law Hung Wai (CPA)[3](index=3&type=chunk) [Committees](index=3&type=section&id=COMMITTEES) The company has established an Audit Committee, a Nomination Committee, and a Remuneration Committee to ensure sound and effective corporate governance - The Audit Committee is chaired by Mr. Yip Kit Chau, with members including Dr. Ho Ka Yan and Mr. Law Hung Wai[3](index=3&type=chunk) - The Nomination Committee is chaired by Mr. Ng Chi Chiu, with members including Mr. Yip Kit Chau, Mr. Law Hung Wai, and Dr. Ho Ka Yan, who was appointed from June 30, 2025[3](index=3&type=chunk)[4](index=4&type=chunk) - The Remuneration Committee is chaired by Mr. Law Hung Wai, with members including Dr. Ho Ka Yan and Mr. Yip Kit Chau[4](index=4&type=chunk)[5](index=5&type=chunk) [Key Personnel and Advisers](index=4&type=section&id=KEY%20PERSONNEL%20AND%20ADVISERS) Mr. Shum Hoi Luen serves as the Company Secretary, with Mr. Ng Chi Chiu and Mr. Shum Hoi Luen as authorized representatives; PricewaterhouseCoopers is the auditor, and Li & Partners is the Hong Kong legal adviser - The Company Secretary is Mr. Shum Hoi Luen, and the authorized representatives are Mr. Ng Chi Chiu and Mr. Shum Hoi Luen[4](index=4&type=chunk)[5](index=5&type=chunk) - PricewaterhouseCoopers serves as the auditor, and Li & Partners is the Hong Kong legal adviser[4](index=4&type=chunk)[5](index=5&type=chunk) [Company Details](index=4&type=section&id=COMPANY%20DETAILS) The company's registered office is in the Cayman Islands, with its Hong Kong headquarters and principal place of business in Kowloon Bay; DBS Bank (Hong Kong) Limited and The Hongkong and Shanghai Banking Corporation Limited are the principal bankers, and the stock code is 0368 - The company's registered office is in the Cayman Islands, and its Hong Kong headquarters and principal place of business are located at 18/F, Chevalier Commercial Centre, 8 Wang Hoi Road, Kowloon Bay, Hong Kong[7](index=7&type=chunk)[8](index=8&type=chunk) - Principal bankers include DBS Bank (Hong Kong) Limited and The Hongkong and Shanghai Banking Corporation Limited[8](index=8&type=chunk) - The company's stock code is **0368**, and its website is www.superland-group.com[8](index=8&type=chunk) [Management Discussion and Analysis](index=5&type=section&id=Management%20Discussion%20and%20Analysis) [Financial Review](index=5&type=section&id=FINANCIAL%20REVIEW) For the six months ended June 30, 2025, the Group's revenue increased by **11.4%** year-on-year to **HK$451 million**, driven by an increase in smaller projects, while gross profit and gross profit margin decreased by **8.0%** and **2.4 percentage points** respectively due to lower margins from these projects, with profit and total comprehensive income attributable to owners remaining relatively stable Financial Performance for the Six Months Ended June 30, 2025 | Indicator | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | Year-on-year Change | | :--- | :--- | :--- | :--- | | Revenue | 450,905 | 404,683 | +11.4% | | Gross Profit | 51,376 | 55,843 | -8.0% | | Gross Profit Margin | 11.4% | 13.8% | -2.4 percentage points | | Administrative Expenses | 30,592 | 31,126 | -1.7% | | Finance Costs | 17,708 | 17,451 | +1.5% | | Profit and Total Comprehensive Income Attributable to Owners | 4,239 | 4,272 | -0.8% | - Revenue growth was primarily due to an increase in the number of smaller projects undertaken during the review period[10](index=10&type=chunk)[15](index=15&type=chunk) - The decrease in gross profit and gross profit margin was mainly attributable to the lower gross profit margins generated from smaller projects[12](index=12&type=chunk)[16](index=16&type=chunk) [Business Review and Prospects](index=6&type=section&id=BUSINESS%20REVIEW%20AND%20PROSPECTS) The Group is a Hong Kong contractor with over **21 years** of operating history, primarily providing fitting-out and repair and maintenance services; as of June 30, 2025, it had **62** projects on hand with a total contract value of approximately **HK$5.275 billion**, and plans to focus on core business development, explore opportunities, and prioritize advanced technology and digitalization for efficiency and cost reduction amidst a slowing construction industry - The Group is a contractor in Hong Kong with over **21 years** of operating history, providing fitting-out services and repair and maintenance services[22](index=22&type=chunk)[27](index=27&type=chunk)[108](index=108&type=chunk) Overview of Fitting-out Projects on Hand | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total number of projects on hand | 62 items | 60 items | | Total contract value | Approximately HK$5,275 Million | Approximately HK$5,371 Million | | Number of projects HK$50 Million or above | 36 items | 37 items | | Total contract value of projects HK$50 Million or above | Approximately HK$4,354 Million | Approximately HK$4,429 Million | - Hong Kong's construction industry growth is slowing, but the government's commitment to developing the Northern Metropolis, land, and housing presents long-term opportunities[28](index=28&type=chunk)[29](index=29&type=chunk)[32](index=32&type=chunk) - The Group will invest resources in developing its core business, exploring potential opportunities, and leveraging advanced technologies such as AI and big data to drive digital transformation for enhanced efficiency and reduced costs[30](index=30&type=chunk)[31](index=31&type=chunk)[32](index=32&type=chunk)[33](index=33&type=chunk) [Debts and Charge on Assets](index=8&type=section&id=DEBTS%20AND%20CHARGE%20ON%20ASSETS) As of June 30, 2025, the Group's total debt was approximately **HK$488 million**, a slight decrease from the end of 2024; bank financing is secured by personal guarantees from directors, corporate guarantees, properties held by directors and associated companies, investments in insurance contracts, and pledged time deposits, with no interest rate hedging policy but continuous monitoring of interest rate risk Total Debts and Pledged Assets | Indicator | June 30, 2025 (HK$ Thousand) | December 31, 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Total Debts | 488,002 | 498,380 | | Investments in insurance contracts | 61,609 | 59,389 | | Pledged time deposits | 4,122 | 7,187 | - Bank financing is secured by personal guarantees from Mr. Ng Chi Chiu, corporate guarantees, properties held by directors and associated companies, investments in insurance contracts, and pledged time deposits[35](index=35&type=chunk)[38](index=38&type=chunk) - The Group currently has no interest rate hedging policy but continuously monitors interest rate risk prudently[36](index=36&type=chunk)[37](index=37&type=chunk) [Liquidity, Financial Resources and Capital Structure](index=9&type=section&id=LIQUIDITY,%20FINANCIAL%20RESOURCES%20AND%20CAPITAL%20STRUCTURE) Since its listing in July 2020, the Group's capital structure has remained unchanged; as of June 30, 2025, issued share capital was **HK$8 million** with **800 million** ordinary shares, and the Group primarily meets working capital needs through operating cash and bank borrowings, with a gearing ratio of **67.7%** and a current ratio of **1.1** - The company's capital structure has remained unchanged since its listing on July 17, 2020[39](index=39&type=chunk)[43](index=43&type=chunk) Capital Structure and Liquidity Ratios | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Issued share capital | HK$8,000,000 | HK$8,000,000 | | Number of issued ordinary shares | 800,000,000 shares | 800,000,000 shares | | Gearing ratio | 67.7% | 66.3% | | Current ratio | 1.1 | 1.1 | - The Group expects to meet its working capital requirements through cash generated from operations, bank borrowings, and other external financing[40](index=40&type=chunk)[43](index=43&type=chunk) [Foreign Exchange Exposure](index=9&type=section&id=FOREIGN%20EXCHANGE%20EXPOSURE) The Group does not face significant foreign exchange risk as most of its income, expenditures, assets, and liabilities are denominated in Hong Kong Dollars; no financial instruments were used for hedging during the six months ended June 30, 2025 - The Group's transactions and assets and liabilities are largely denominated in Hong Kong Dollars, thus posing no significant foreign exchange risk[42](index=42&type=chunk)[45](index=45&type=chunk) - For the six months ended June 30, 2025, the Group did not use any financial instruments for foreign exchange hedging[42](index=42&type=chunk)[45](index=45&type=chunk) [Employee and Remuneration Policy](index=10&type=section&id=EMPLOYEE%20AND%20REMUNERATION%20POLICY) As of June 30, 2025, the Group had **223** employees, a slight decrease from the end of 2024; remuneration includes salaries, discretionary year-end bonuses, and other cash allowances, along with Mandatory Provident Fund contributions, with employee benefit expenses totaling approximately **HK$53.05 million**, a slight increase year-on-year Employees and Employee Benefit Expenses | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total number of employees | 223 | 233 | | Employee benefit expenses (for the six months ended June 30) | HK$53,050 Thousand | HK$52,229 Thousand | - Remuneration policy is based on employees' qualifications, experience, and performance, with regular reviews for salary adjustments, bonuses, and promotions[47](index=47&type=chunk)[54](index=54&type=chunk) [Significant Investments, Material Acquisitions or Disposals](index=10&type=section&id=SIGNIFICANT%20INVESTMENTS,%20MATERIAL%20ACQUISITIONS%20OR%20DISPOSALS) For the six months ended June 30, 2025, the Group had no significant investments, material acquisitions, or disposals, nor had the Board authorized any formal plans for such activities - For the six months ended June 30, 2025, the Group had no significant investments, material acquisitions, or disposals[49](index=49&type=chunk)[55](index=55&type=chunk) - The Board had not authorized any formal plans for significant investments, acquisitions, or disposals[49](index=49&type=chunk)[55](index=55&type=chunk) [Future Plans for Material Investments or Capital Assets](index=10&type=section&id=FUTURE%20PLANS%20FOR%20MATERIAL%20INVESTMENTS%20OR%20CAPITAL%20ASSETS) As of June 30, 2025, the Group had no other future plans for material investments or capital assets - As of June 30, 2025, the Group had no other future plans for material investments or capital assets[50](index=50&type=chunk)[56](index=56&type=chunk) [Capital Commitments](index=10&type=section&id=CAPITAL%20COMMITMENTS) As of June 30, 2025, the Group had no significant capital commitments - As of June 30, 2025, the Group had no significant capital commitments[51](index=51&type=chunk)[57](index=57&type=chunk) [Contingent Liabilities](index=10&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[52](index=52&type=chunk)[58](index=58&type=chunk) [Events After the Reporting Period](index=10&type=section&id=EVENTS%20AFTER%20THE%20REPORTING%20PERIOD) As of the date of this interim report, no other significant events occurred after the reporting period - As of the date of this interim report, no other significant events occurred after the reporting period[53](index=53&type=chunk)[59](index=59&type=chunk) [Corporate Governance and Other Information](index=11&type=section&id=Corporate%20Governance%20and%20Other%20Information) [Interim Dividend](index=11&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[60](index=60&type=chunk)[66](index=66&type=chunk) [Related Party Transactions](index=11&type=section&id=RELATED%20PARTY%20TRANSACTIONS) For the six months ended June 30, 2025, the Group had no material connected transactions or continuing connected transactions as defined by the Listing Rules, other than those disclosed - For the six months ended June 30, 2025, the Group had no material connected transactions or continuing connected transactions as defined by the Listing Rules[61](index=61&type=chunk)[67](index=67&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=11&type=section&id=PURCHASE,%20SALE%20OR%20REDEMPTION%20OF%20THE%20COMPANY'S%20LISTED%20SECURITIES) For the six months ended June 30, 2025, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities - For the six months ended June 30, 2025, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities[62](index=62&type=chunk)[68](index=68&type=chunk) [Directors' Securities Transactions](index=11&type=section&id=DIRECTORS'%20SECURITIES%20TRANSACTIONS) The company has adopted the Model Code set out in Appendix C3 of the Listing Rules, and all directors confirmed compliance for the six months ended June 30, 2025 - The company has adopted the Model Code set out in Appendix C3 of the Listing Rules as the code of conduct for directors' dealings in the company's securities[63](index=63&type=chunk)[69](index=69&type=chunk) - All directors confirmed compliance with the Model Code for the six months ended June 30, 2025[63](index=63&type=chunk)[69](index=69&type=chunk) [Corporate Governance Practices](index=11&type=section&id=CORPORATE%20GOVERNANCE%20PRACTICES) For the six months ended June 30, 2025, the company complied with the Corporate Governance Code, except for the combined roles of Chairman and Chief Executive Officer held by Mr. Ng Chi Chiu, which the Board believes is in the Group's best interest - The company has complied with the Corporate Governance Code, except that the roles of Chairman and Chief Executive Officer are not separate, both held by Mr. Ng Chi Chiu[64](index=64&type=chunk)[65](index=65&type=chunk)[70](index=70&type=chunk) - The Board believes Mr. Ng Chi Chiu's dual role is in the Group's best interest due to his profound industry knowledge and experience, with sufficient safeguards to ensure a balance of power[65](index=65&type=chunk)[70](index=70&type=chunk) [Disclosure of Interests](index=12&type=section&id=DISCLOSURE%20OF%20INTERESTS) As of June 30, 2025, directors and the chief executive held interests in the company's shares and associated corporations; Mr. Ng Chi Chiu and Ms. Chiu Hoi Yin (his spouse) are deemed to hold a **75%** long position in the company's shares Directors' Long Positions in Shares | Director's Name | Capacity | Number of Shares Held | Position | Percentage of Shareholding | | :--- | :--- | :--- | :--- | :--- | | Mr. Ng Chi Chiu | Interest in controlled corporation | 600,000,000 | Long position | 75% | | Ms. Chiu Hoi Yin | Spouse's interest | 600,000,000 | Long position | 75% | - Mr. Ng Chi Chiu beneficially owns the entire issued share capital of Space Plus Investment Company Limited and is therefore deemed to be interested in the shares held by Space Plus[74](index=74&type=chunk) - Ms. Chiu Hoi Yin, as the spouse of Mr. Ng Chi Chiu, is deemed to be interested in the shares held by Mr. Ng Chi Chiu[75](index=75&type=chunk) [Substantial Shareholders' Interests in the Company](index=13&type=section&id=SUBSTANTIAL%20SHAREHOLDERS'%20INTERESTS%20IN%20THE%20COMPANY) As of June 30, 2025, in addition to directors' interests, Space Plus Investment Company Limited held a **75%** long position in the company's shares, qualifying as a substantial shareholder Substantial Shareholders' Interests in the Company | Shareholder's Name | Capacity | Number of Shares Held | Position | Percentage of Shareholding | | :--- | :--- | :--- | :--- | :--- | | Space Plus Investment Company Limited | Beneficial owner | 600,000,000 | Long position | 75% | [Share Options](index=14&type=section&id=SHARE%20OPTIONS) The company's share option scheme, adopted on June 16, 2020, aims to recognize and incentivize eligible participants; as of June 30, 2025, there were no outstanding share options, and the total number of shares available for issue was **76,000,000**, representing **9.5%** of issued shares - The Share Option Scheme aims to recognize and incentivize eligible participants, offering opportunities for personal interest to optimize performance, enhance efficiency, and attract and retain talent[84](index=84&type=chunk)[89](index=89&type=chunk) - As of June 30, 2025, no share options granted under the Share Option Scheme remained outstanding and unexercised[85](index=85&type=chunk)[90](index=90&type=chunk) - As of June 30, 2025, the total number of shares available for issue under the Share Option Scheme was **76,000,000**, representing **9.5%** of the issued shares[86](index=86&type=chunk)[90](index=90&type=chunk) [Changes in Director's Information](index=15&type=section&id=CHANGES%20IN%20DIRECTOR'S%20INFORMATION) Dr. Ho Ka Yan was appointed as a member of the company's Nomination Committee effective June 30, 2025 - Dr. Ho Ka Yan was appointed as a member of the company's Nomination Committee effective June 30, 2025[92](index=92&type=chunk)[95](index=95&type=chunk) [Review of Interim Results](index=15&type=section&id=REVIEW%20OF%20INTERIM%20RESULTS) The Audit Committee has reviewed the interim condensed consolidated financial information, discussed accounting principles and practices with management, and raised no objections to the accounting treatments adopted - The Audit Committee, comprising three independent non-executive directors, has reviewed the interim condensed consolidated financial information[93](index=93&type=chunk)[96](index=96&type=chunk) - The Audit Committee and management have reviewed the accounting principles and practices adopted by the Group, with no objections to the accounting treatments[93](index=93&type=chunk)[96](index=96&type=chunk) [Appreciation](index=15&type=section&id=APPRECIATION) The Board extends its sincere gratitude to shareholders, clients, suppliers, subcontractors, bankers, professionals, and the management team and staff - The Board extends its sincere gratitude to shareholders, clients, suppliers, subcontractors, bankers, professionals, and the management team and staff[94](index=94&type=chunk)[97](index=97&type=chunk) [Interim Condensed Consolidated Statement of Comprehensive Income](index=16&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) [Consolidated Statement of Comprehensive Income](index=16&type=section&id=Consolidated%20Statement%20of%20Comprehensive%20Income) This statement presents the Group's consolidated revenue, costs, gross profit, other gains/losses, expenses, finance costs, tax, and profit and total comprehensive income attributable to owners for the six months ended June 30, 2025, and the corresponding period in 2024 Summary of Consolidated Statement of Comprehensive Income for the Six Months Ended June 30, 2025 | Indicator | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Revenue | 450,905 | 404,683 | | Gross Profit | 51,376 | 55,843 | | Profit before income tax expense | 5,274 | 6,144 | | Profit and total comprehensive income attributable to owners for the period | 4,239 | 4,272 | | Basic and diluted earnings per share (HK cents) | 0.53 | 0.53 | [Interim Condensed Consolidated Statement of Financial Position](index=17&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) [Consolidated Statement of Financial Position](index=17&type=section&id=Consolidated%20Statement%20of%20Financial%20Position) This statement presents the Group's consolidated assets, liabilities, and equity as of June 30, 2025, and December 31, 2024 Summary of Consolidated Statement of Financial Position as of June 30, 2025 | Indicator | June 30, 2025 (HK$ Thousand) | December 31, 2024 (HK$ Thousand) | | :--- | :--- | :--- | | **ASSETS** | | | | Non-current assets | 130,694 | 127,709 | | Current assets | 906,563 | 937,713 | | **TOTAL ASSETS** | **1,037,257** | **1,065,422** | | **EQUITY AND LIABILITIES** | | | | Equity attributable to owners of the Company | 210,915 | 220,036 | | Non-current liabilities | 15,947 | 17,962 | | Current liabilities | 810,395 | 827,424 | | **TOTAL LIABILITIES** | **826,342** | **845,386** | | **TOTAL EQUITY AND LIABILITIES** | **1,037,257** | **1,065,422** | [Interim Condensed Consolidated Statement of Changes in Equity](index=19&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) [Consolidated Statement of Changes in Equity](index=19&type=section&id=Consolidated%20Statement%20of%20Changes%20in%20Equity) This statement presents the Group's equity changes for the six months ended June 30, 2025, and the corresponding period in 2024, including opening balances, profit and total comprehensive income for the period, and dividend distributions Summary of Consolidated Statement of Changes in Equity for the Six Months Ended June 30, 2025 | Indicator | June 30, 2025 (HK$ Thousand) | January 1, 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Total equity at beginning of period | 220,036 | 201,152 | | Profit and total comprehensive income for the period | 4,239 | 4,272 | | Dividends | (13,360) | - | | Total equity at end of period | 210,915 | 205,424 | [Interim Condensed Consolidated Statement of Cash Flows](index=20&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) [Consolidated Statement of Cash Flows](index=20&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) This statement presents the Group's cash flows from operating, investing, and financing activities for the six months ended June 30, 2025, and the corresponding period in 2024 Summary of Consolidated Statement of Cash Flows for the Six Months Ended June 30, 2025 | Activity Type | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Net cash generated from operating activities | 8,367 | 19,596 | | Net cash used in investing activities | - | (9,105) | | Net cash (used in) / generated from financing activities | (25,021) | 4,981 | | Net (decrease) / increase in cash and cash equivalents | (16,654) | 15,472 | | Cash and cash equivalents at end of period | 41,208 | 57,863 | [Notes to the Interim Condensed Consolidated Financial Information](index=21&type=section&id=Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Information) [1. General Information](index=21&type=section&id=1.%20GENERAL%20INFORMATION) The company was incorporated in the Cayman Islands on July 11, 2019, and listed on the Main Board of the Stock Exchange on July 17, 2020, primarily providing fitting-out and repair and maintenance services in Hong Kong - The company was incorporated in the Cayman Islands on July 11, 2019, and listed on the Main Board of the Stock Exchange on July 17, 2020[107](index=107&type=chunk)[108](index=108&type=chunk)[112](index=112&type=chunk) - The Group is principally engaged in providing fitting-out services and repair and maintenance services for residential and commercial properties in Hong Kong[108](index=108&type=chunk)[113](index=113&type=chunk) [2. Basis of Preparation](index=21&type=section&id=2.%20BASIS%20OF%20PREPARATION) This interim condensed consolidated financial information is prepared in accordance with applicable disclosure provisions of the Listing Rules and HKAS 34, and should be read in conjunction with the annual financial statements for the year ended December 31, 2024 - The financial information is prepared in accordance with the Listing Rules and Hong Kong Accounting Standard 34 "Interim Financial Reporting"[109](index=109&type=chunk)[114](index=114&type=chunk) - The preparation of financial information involves management's judgments, estimates, and assumptions[110](index=110&type=chunk)[114](index=114&type=chunk) [3. Summary of Material Accounting Policies](index=22&type=section&id=3.%20SUMMARY%20OF%20MATERIAL%20ACCOUNTING%20POLICIES) This interim financial information is prepared under the historical cost convention, with investments in insurance contracts measured at surrender cash value; the Group has adopted HKAS 21 and HKFRS 1 (amended) "Lack of Exchangeability," with no material impact on results, and also lists new standards and amendments not yet effective - The financial information is prepared under the historical cost convention, and investments in insurance contracts are measured at their surrender cash value[115](index=115&type=chunk)[118](index=118&type=chunk) - The Group has adopted the amended HKAS 21 and HKFRS 1 "Lack of Exchangeability," which have no material impact on the Group's results and financial position[117](index=117&type=chunk)[119](index=119&type=chunk) - Several new standards and amendments not yet effective are listed, and the Group is assessing their impact[120](index=120&type=chunk)[121](index=121&type=chunk) [4. Fair Value Estimation](index=24&type=section&id=4.%20FAIR%20VALUE%20ESTIMATION) The Group analyzes the fair value of financial instruments based on a hierarchy of valuation technique inputs (Level 1, Level 2, Level 3); the carrying amounts of most financial assets and liabilities approximate their fair values due to their short-term maturities or floating interest rates - The fair value of financial instruments is analyzed based on a hierarchy of valuation technique inputs (Level 1, Level 2, Level 3)[122](index=122&type=chunk)[126](index=126&type=chunk) - The carrying amounts of most financial assets and liabilities approximate their fair values due to their short-term maturities or floating interest rates[122](index=122&type=chunk)[124](index=124&type=chunk) [5. Seasonality](index=24&type=section&id=5.%20SEASONALITY) During the review period, the Group recorded higher revenue in the months leading up to the Lunar New Year and lower revenue in the Lunar New Year month itself, attributed to labor shortages and project arrangements - The Group's revenue is higher in the months leading up to the Lunar New Year and lower in the Lunar New Year month[123](index=123&type=chunk)[125](index=125&type=chunk) - Seasonal impact is attributed to potential labor shortages during or after the Lunar New Year, leading to arrangements with clients, suppliers, and subcontractors to complete more work before the holiday[123](index=123&type=chunk)[125](index=125&type=chunk) [6. Revenue and Segment Information](index=25&type=section&id=6.%20REVENUE%20AND%20SEGMENT%20INFORMATION) The Group Chairman, as the chief operating decision maker, allocates resources and assesses performance based on entity-level consolidated financial information, resulting in a single operating segment; all revenue and assets are derived from Hong Kong - The Group Chairman acts as the chief operating decision maker, allocating resources and assessing performance based on entity-level consolidated financial information, thus operating as a single business segment[127](index=127&type=chunk)[128](index=128&type=chunk)[130](index=130&type=chunk) Revenue Breakdown (by Service Segment) | Service Type | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Fitting-out services | 448,267 | 403,075 | | Repair and maintenance services | 2,638 | 1,608 | | **Total Revenue** | **450,905** | **404,683** | - All of the Group's revenue and assets are based in and generated from Hong Kong[133](index=133&type=chunk)[135](index=135&type=chunk) [7. Income Tax Expense](index=26&type=section&id=7.%20INCOME%20TAX%20EXPENSE) For the six months ended June 30, 2025, income tax expense was **HK$1.035 million**, a decrease from the prior year; Hong Kong profits tax is calculated under a two-tiered system, with the first **HK$2 million** taxed at **8.25%** and the remainder at **16.5%** Income Tax Expense | Indicator | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Current income tax | 1,035 | 1,463 | | Deferred income tax | - | 409 | | **Total Income Tax Expense** | **1,035** | **1,872** | - Hong Kong profits tax is calculated under a two-tiered system: the first **HK$2 million** is taxed at **8.25%**, and the remainder at **16.5%**[137](index=137&type=chunk)[138](index=138&type=chunk) [8. Profit for the Period](index=26&type=section&id=8.%20PROFIT%20FOR%20THE%20PERIOD) This section details the expenses deducted from the Group's profit for the period ended June 30, 2025, including subcontracting fees, material costs, depreciation, employee benefit expenses, and interest expenses Items Deducted from Profit for the Period | Expense Item | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Subcontracting fees | 270,011 | 251,826 | | Material costs | 88,189 | 53,616 | | Depreciation of plant and equipment | 283 | 459 | | Depreciation of right-of-use assets | 6,973 | 2,417 | | Employee benefit expenses (including directors' emoluments) | 53,050 | 52,229 | | Interest expense on borrowings | 17,106 | 17,351 | | Interest portion of lease liabilities | 602 | 100 | [9. Earnings Per Share](index=27&type=section&id=9.%20EARNINGS%20PER%20SHARE) For the six months ended June 30, 2025, both basic and diluted earnings per share were **0.53 HK cents**, consistent with the prior year, as there were no potentially dilutive ordinary shares Earnings Per Share Calculation | Indicator | 2025 (HK$) | 2024 (HK$) | | :--- | :--- | :--- | | Profit attributable to owners of the Company | 4,239,000 | 4,272,000 | | Weighted average number of ordinary shares in issue | 800,000,000 | 800,000,000 | | Basic and diluted earnings per share (HK cents) | 0.53 | 0.53 | - As there were no potentially dilutive ordinary shares outstanding for the six months ended June 30, 2025, diluted earnings per share were the same as basic earnings per share[144](index=144&type=chunk)[148](index=148&type=chunk) [10. Dividends](index=27&type=section&id=10.%20DIVIDENDS) The Board does not recommend an interim dividend for the six months ended June 30, 2025; the 2024 final dividend of **1.67 HK cents** per share, totaling **HK$13.36 million**, was approved by shareholders on June 25, 2025 - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025[145](index=145&type=chunk)[149](index=149&type=chunk) - The final dividend for the year ended December 31, 2024, was **1.67 HK cents** per share, totaling **HK$13,360,000**, approved by shareholders on June 25, 2025[145](index=145&type=chunk)[149](index=149&type=chunk) [11. Plant and Equipment](index=27&type=section&id=11.%20PLANT%20AND%20EQUIPMENT) For the six months ended June 30, 2025, the Group made no significant additions to plant and equipment - For the six months ended June 30, 2025, the Group made no significant additions to plant and equipment[146](index=146&type=chunk)[150](index=150&type=chunk) [12. Right-of-Use Assets](index=27&type=section&id=12.%20RIGHT-OF-USE%20ASSETS) For the six months ended June 30, 2025, the Group made no significant additions to right-of-use assets - For the six months ended June 30, 2025, the Group made no significant additions to right-of-use assets[147](index=147&type=chunk)[151](index=151&type=chunk) [13. Investments in Insurance Contracts](index=28&type=section&id=13.%20INVESTMENTS%20IN%20INSURANCE%20CONTRACTS) Investments in insurance contracts primarily refer to key management life policies where the Group is the beneficiary and which are pledged to banks as collateral for financing; as of June 30, 2025, the investment value was **HK$61.609 million**, with a net change in surrender value of **HK$2.22 million** during the period - Investments in insurance contracts refer to key management life policies where the Group is the beneficiary[153](index=153&type=chunk) - The policies are pledged to banks as collateral for certain financing granted to the Group[153](index=153&type=chunk) Changes in Investments in Insurance Contracts | Indicator | June 30, 2025 (HK$ Thousand) | December 31, 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Balance at beginning of period | 59,389 | 49,812 | | Additions during the period | - | 9,294 | | Net change in surrender value | 2,220 | 283 | | Balance at end of period | 61,609 | 59,389 | [14. Trade Receivables](index=28&type=section&id=14.%20TRADE%20RECEIVABLES) As of June 30, 2025, net trade receivables were **HK$78.341 million**, a significant decrease from **HK$159 million** at the end of 2024; the aging analysis shows a decrease in receivables within **30 days** and an increase in those between **61-90 days** and over **90 days** Net Trade Receivables and Aging Analysis | Indicator | June 30, 2025 (HK$ Thousand) | December 31, 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Net trade receivables | 78,341 | 158,961 | | **Aging analysis (before impairment allowance):** | | | | 1–30 days | 32,715 | 88,218 | | 31–60 days | 17,857 | 56,060 | | 61–90 days | 23,746 | 7,413 | | Over 90 days | 4,063 | 7,297 | [15. Share Capital](index=29&type=section&id=15.%20SHARE%20CAPITAL) As of June 30, 2025, the company's authorized share capital was **HK$20 million**, divided into **2 billion** shares of **HK$0.01** par value each; issued and fully paid share capital was **HK$8 million**, comprising **800 million** shares Share Capital Structure | Indicator | Number | Amount (HK$ Thousand) | | :--- | :--- | :--- | | Authorized ordinary shares | 2,000,000,000 | 20,000 | | Issued and fully paid ordinary shares | 800,000,000 | 8,000 | [16. Trade Payables](index=30&type=section&id=16.%20TRADE%20PAYABLES) As of June 30, 2025, total trade payables were **HK$153.9 million**, a decrease from **HK$171 million** at the end of 2024; the aging analysis shows that payables within **30 days** remain the largest portion, while those over **90 days** have decreased Trade Payables and Aging Analysis | Indicator | June 30, 2025 (HK$ Thousand) | December 31, 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Total trade payables | 153,945 | 171,044 | | **Aging analysis (by invoice date):** | | | | 1–30 days | 109,364 | 125,273 | | 31–60 days | 24,842 | 19,891 | | 61–90 days | 13,134 | 8,168 | | Over 90 days | 6,605 | 17,712 | [17. Contingencies](index=30&type=section&id=17.%20CONTINGENCIES) As of June 30, 2025, the Group's contingent liabilities primarily consisted of performance guarantees totaling **HK$148.6 million**, related to **13** fitting-out contracts Contingent Liabilities | Indicator | June 30, 2025 (HK$ Thousand) | December 31, 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Performance guarantees | 148,639 | 126,423 | - Performance guarantees involve **13** fitting-out contracts, for which the Group provides corporate guarantees, expected to be released according to contract terms[166](index=166&type=chunk)[167](index=167&type=chunk) [18. Related Party Transactions](index=31&type=section&id=18.%20RELATED%20PARTY%20TRANSACTIONS) This section discloses transactions between the Group and related parties, including lease payments to directors and associated companies, bank financing guarantees provided by directors and jointly controlled companies, and key management personnel compensation Transactions with Related Parties | Transaction Type | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Lease payments to directors | 300 | 300 | | Lease payments to associated companies | 300 | 300 | - Bank financing is secured by property, corporate, and personal guarantees provided by directors Mr. Ng Chi Chiu, Ms. Chiu Hoi Yin, and several associated companies jointly controlled by Mr. Ng[174](index=174&type=chunk)[175](index=175&type=chunk) Key Management Personnel Compensation | Compensation Type | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Directors' emoluments | 3,033 | 3,505 | | Key management personnel salaries | 555 | 555 | | **Total** | **3,588** | **4,060** | [19. Approval of the Interim Condensed Consolidated Financial Information](index=33&type=section&id=19.%20APPROVAL%20OF%20THE%20INTERIM%20CONDENSED%20CONSOLIDATED%20FINANCIAL%20INFORMATION) This interim condensed consolidated financial information was approved and authorized for issue by the Board of Directors on August 27, 2025 - This interim condensed consolidated financial information was approved and authorized for issue by the Board of Directors on August 27, 2025[179](index=179&type=chunk)[180](index=180&type=chunk)

Interim Report 2 0 2 5 中期報告 C004888 中期報告 Interim Report 2025 Contents 目錄 | 2 | Corporate Profile | 公司簡介 | | --- | --- | --- | | 3 | Financial Highlights | 財務摘要 | | 4 | Management Discussion and Analysis | 管理層討論及分析 | | 17 | Corporate Governance and Other Information | 企業管治及其他資料 | | 24 | Report on Review of Condensed | 簡明綜合財務報表的審閱報告 | | | Consolidated Financial Statements | | | 26 | Condensed Consolidated Statement of | 簡明綜合損益及其他全面收益表 | | | Profit or Loss and Other Comprehensive Income | | | 28 | Condensed Co ...

CONTENTS 目錄 | Corporate Information | 公司資料 | 2 | | --- | --- | --- | | Definitions | 釋義 | 4 | | Chairman's Report | 主席報告 | 6 | | Management Discussion and Analysis | 管理層討論及分析 | 9 | | Interim Condensed Consolidated Statement of | 中期簡明綜合損益及 | 33 | | Profit or Loss and Other Comprehensive Income | 其他全面收益表 | | | Interim Condensed Consolidated Statement of Financial Position | 中期簡明綜合財務狀況表 | 35 | | Interim Condensed Consolidated Statement of Changes in Equity | 中期簡明綜合權益變動表 | 37 | | Interim Condensed Consolidated ...

網址 : www.citicbank.com （於中華人民共和國註冊成立的股份有限公司） 股份代號：0998 本中期報告由可循環再造紙印刷 中期報告 2025 地址 : 北京市朝陽區光華路10號院1號樓6-30層、32-42層 郵編 : 100020 投資者熱線 : +86-10-66638188 投資者電子信箱 : ir@citicbank.com 中期利潤分配預案：本報告第三章「公司治理、環境和社會－ 2025年中期利潤分配」披露了經董事會審議通過的，擬提交臨 時股東大會審議的2025年中期利潤分配方案，每10股派發現金股息1.88元人民幣（含稅）。本行2025年上半年不進行資本公 積金轉增股本。 本行根據中國會計準則和國際財務報告會計準則編製的2025年中期財務報告，已經畢馬威華振會計師事務所（特殊普通合 夥）和畢馬威會計師事務所分別根據中國和香港審閱準則審閱。 中信銀行股份有限公司中期報告 2025 重要提示 本行董事會、監事會及董事、監事、高級管理人員保證本行2025年半年度報告內容的真實、準確、完整，不存在虛假記 載、誤導性陳述或重大遺漏，並承擔個別和連帶的法律責任。 本行董事會會議於2025年8 ...