I. [Company Information and Financial Summary](index=1&type=section&id=I.%20Company%20Information%20and%20Financial%20Summary) This section provides an overview of the company's interim performance and key financial highlights for the first half of 2025 [1.1 Company Statement and Basic Information](index=1&type=section&id=1.1%20Company%20Statement%20and%20Basic%20Information) This announcement presents the unaudited interim results of Zhaojin Mining Industry Co., Ltd. for the six months ended June 30, 2025, reviewed by the Audit Committee - This announcement is the unaudited interim results announcement of Zhaojin Mining Industry Co., Ltd. for the six months ended June 30, 2025[2](index=2&type=chunk)[3](index=3&type=chunk) - The content of the announcement has been reviewed by the Board's Audit Committee[3](index=3&type=chunk) [1.2 Financial Summary](index=1&type=section&id=1.2%20Financial%20Summary) For the six months ended June 30, 2025, the company achieved significant growth in revenue, net profit, profit attributable to parent company shareholders, and earnings per share, with no interim dividend proposed Key Financial Indicators for H1 2025 | Indicator | H1 2025 (RMB thousands) | H1 2024 (RMB thousands) | YoY Growth Rate | | :--- | :--- | :--- | :--- | | Revenue | 6,972,841 | 4,627,203 | 50.69% | | Net Profit | 1,776,694 | 726,420 | 144.58% | | Profit attributable to parent company shareholders | 1,439,690 | 552,793 | 160.44% | | Basic and diluted earnings per share (RMB yuan) | 0.38 | 0.12 | 216.67% | - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025[3](index=3&type=chunk) II. [Interim Condensed Consolidated Financial Statements](index=2&type=section&id=II.%20Interim%20Condensed%20Consolidated%20Financial%20Statements) This section presents the interim condensed consolidated financial statements, including the income statement, comprehensive income statement, and statement of financial position [2.1 Interim Condensed Consolidated Income Statement](index=2&type=section&id=2.1%20Interim%20Condensed%20Consolidated%20Income%20Statement) For the six months ended June 30, 2025, the company reported significant growth in revenue and profit, with a substantial increase in gross profit, indicating strong operational performance Summary of Interim Condensed Consolidated Income Statement (RMB thousands) | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Revenue | 6,972,841 | 4,627,203 | | Cost of sales | (3,922,605) | (2,650,560) | | Gross profit | 3,050,236 | 1,976,643 | | Other income and gains | 1,133,655 | 383,824 | | Profit before tax | 2,248,870 | 953,079 | | Profit for the period | 1,776,694 | 726,420 | | Profit attributable to owners of the parent | 1,439,690 | 552,793 | | Basic and diluted earnings per share (RMB yuan) | 0.38 | 0.12 | [2.2 Interim Condensed Consolidated Statement of Comprehensive Income](index=3&type=section&id=2.2%20Interim%20Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) For the six months ended June 30, 2025, the company's comprehensive profit significantly increased, driven by higher profit for the period and fair value changes in equity investments measured at fair value through other comprehensive income Summary of Interim Condensed Consolidated Statement of Comprehensive Income (RMB thousands) | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Profit for the period | 1,776,694 | 726,420 | | Exchange differences on translation of foreign operations | 64,967 | (9,342) | | Fair value changes of equity investments measured at fair value through other comprehensive income | 182,452 | (85,807) | | Other comprehensive income for the period, net of tax | 246,737 | (93,652) | | Total comprehensive income for the period | 2,023,431 | 632,768 | | Total comprehensive income attributable to owners of the parent | 1,679,320 | 459,869 | [2.3 Interim Condensed Consolidated Statement of Financial Position](index=4&type=section&id=2.3%20Interim%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the company's total assets and net assets increased, and net current liabilities improved, reflecting a stable financial position Summary of Interim Condensed Consolidated Statement of Financial Position (RMB thousands) | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total non-current assets | 41,276,095 | 39,676,995 | | Total current assets | 16,995,542 | 13,890,950 | | Total current liabilities | 17,081,953 | 14,435,157 | | Net current liabilities | (86,411) | (544,207) | | Net assets | 27,588,237 | 25,192,291 | | Total equity | 27,588,237 | 25,192,291 | III. [Notes to the Interim Condensed Consolidated Financial Statements](index=6&type=section&id=III.%20Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed notes to the interim condensed consolidated financial statements, covering accounting policies, segment information, revenue, and other financial disclosures [3.1 Basis of Preparation](index=6&type=section&id=3.1%20Basis%20of%20Preparation) The interim condensed consolidated financial information is prepared in accordance with HKAS 34 "Interim Financial Reporting" and should be read in conjunction with the annual consolidated financial statements - The interim condensed consolidated financial information has been prepared in accordance with Hong Kong Accounting Standard 34 'Interim Financial Reporting'[8](index=8&type=chunk) - The interim financial information does not include all the information and disclosures required in the annual financial statements and should be read in conjunction with the annual consolidated financial statements for the year ended December 31, 2024[8](index=8&type=chunk) [3.2 Changes in Accounting Policies](index=6&type=section&id=3.2%20Changes%20in%20Accounting%20Policies) Except for the initial adoption of revised HKFRSs, the accounting policies used to prepare the interim condensed consolidated financial information are consistent with the annual consolidated financial statements, with no impact from HKAS 21 amendments - The accounting policies adopted in preparing the interim condensed consolidated financial information are consistent with those applied in the annual consolidated financial statements, except for the initial adoption of revised Hong Kong Financial Reporting Standards[9](index=9&type=chunk) - The amendments to HKAS 21 regarding lack of exchangeability have no impact on the Group's interim condensed consolidated financial information, as the Group's transaction currency and functional currency are exchangeable[10](index=10&type=chunk) [3.3 Segment Information](index=7&type=section&id=3.3%20Segment%20Information) The Group's operations are primarily divided into gold, copper, and other businesses, with gold mining being the main source of revenue and profit, while the copper business recorded a loss in H1 2025 - The Group's operating activities are not seasonal[13](index=13&type=chunk) [3.3.1 Segment Results for H1 2025](index=7&type=section&id=3.3.1%20Segment%20Results%20for%20H1%202025) In H1 2025, the gold mining business contributed the vast majority of revenue and profit, the copper business remained in a loss-making state, but other businesses performed well Summary of Segment Results for H1 2025 (RMB thousands) | Indicator | Gold Mining Business | Copper Mining Business | Others | Total | | :--- | :--- | :--- | :--- | :--- | | Revenue from external customers | 6,163,750 | 223,616 | 585,475 | 6,972,841 | | Segment results | 2,375,495 | (651,666) | 706,501 | 2,430,330 | | Segment assets | 44,575,380 | 1,894,779 | 6,896,445 | 53,366,604 | | Capital expenditure | 2,638,345 | 13,286 | 20,070 | 2,671,701 | | Impairment losses recognized in profit or loss | 73,394 | 655,847 | 11,324 | 740,565 | [3.3.2 Segment Results for H1 2024](index=8&type=section&id=3.3.2%20Segment%20Results%20for%20H1%202024) In H1 2024, the gold mining business was also the primary source of revenue and profit, the copper business incurred losses, and capital expenditure was mainly concentrated in gold mining Summary of Segment Results for H1 2024 (RMB thousands) | Indicator | Gold Mining Business | Copper Mining Business | Others | Total | | :--- | :--- | :--- | :--- | :--- | | Revenue from external customers | 4,268,141 | 169,881 | 189,181 | 4,627,203 | | Segment results | 1,142,771 | (33,500) | (2,351) | 1,106,920 | | Segment assets | 42,234,489 | 2,619,769 | 3,848,940 | 48,703,198 | | Capital expenditure | 5,964,809 | 38,341 | 17,391 | 6,020,541 | | Impairment losses recognized in profit or loss | 237,547 | 735 | 4,114 | 242,396 | [3.4 Revenue](index=9&type=section&id=3.4%20Revenue) The Group's revenue primarily derives from gold sales, with mainland China being the main operating region, and most revenue recognized at a point in time [3.4.1 Revenue Analysis for H1 2025](index=9&type=section&id=3.4.1%20Revenue%20Analysis%20for%20H1%202025) Total revenue for H1 2025 was RMB 6,972,841 thousands, with gold sales accounting for the largest proportion, and mainland China contributing most of the revenue Revenue Composition for H1 2025 (RMB thousands) | Category | Amount | | :--- | :--- | | Revenue from contracts with customers | 7,179,623 | | Less: Government surcharges | (206,782) | | Total | 6,972,841 | | Sales of gold | 6,500,058 | | Sales of copper | 221,892 | | Sales of silver | 81,374 | | Revenue from Mainland China | 6,107,415 | | Overseas revenue | 1,072,208 | | Revenue recognized at a point in time | 7,142,941 | [3.4.2 Revenue Analysis for H1 2024](index=10&type=section&id=3.4.2%20Revenue%20Analysis%20for%20H1%202024) Total revenue for H1 2024 was RMB 4,627,203 thousands, with gold sales also being the primary revenue source, and mainland China as the main market Revenue Composition for H1 2024 (RMB thousands) | Category | Amount | | :--- | :--- | | Revenue from contracts with customers | 4,763,553 | | Less: Government surcharges | (136,350) | | Total | 4,627,203 | | Sales of gold | 4,299,037 | | Sales of copper | 149,620 | | Sales of silver | 67,264 | | Revenue from Mainland China | 4,557,731 | | Overseas revenue | 205,822 | | Revenue recognized at a point in time | 4,704,440 | [3.5 Profit Before Tax](index=10&type=section&id=3.5%20Profit%20Before%20Tax) The Group's profit before tax is derived after deducting cost of inventories sold, various impairment losses, and exchange gains/losses, with a significant increase in impairment of property, plant and equipment in H1 2025 Summary of Profit Before Tax Deductions (RMB thousands) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Cost of inventories sold | 3,922,605 | 2,650,560 | | Impairment provision for inventories | – | 12,958 | | Impairment of trade receivables | 6,637 | 10,097 | | Impairment of loans receivable | 10,906 | 1,361 | | Impairment of other intangible assets | 12,405 | – | | Impairment of property, plant and equipment | 710,617 | 217,980 | | Exchange (gains)/losses | (117,892) | 34,882 | [3.6 Income Tax Expense](index=11&type=section&id=3.6%20Income%20Tax%20Expense) The Group's income tax expense primarily arises from mainland China, Hong Kong, and overseas regions, with applicable tax rates determined by local regulations, and some subsidiaries enjoying preferential tax rates - Mainland China enterprise income tax is provided at a rate of **25%**, with high-tech enterprises and subsidiaries in the Western Development region enjoying a preferential rate of **15%**[19](index=19&type=chunk) - Hong Kong profits tax is accrued at **16.5%**, with entities qualifying for the two-tiered profits tax regime taxed at **8.25%** for the first HKD 2,000,000[19](index=19&type=chunk) Income Tax Expense Details (RMB thousands) | Category | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Current – Mainland China | 340,192 | 231,200 | | Current – Hong Kong and overseas regions | 151,645 | 9,983 | | Deferred tax | (19,661) | (14,524) | | Income tax expense for the period | 472,176 | 226,659 | [3.7 Dividends](index=11&type=section&id=3.7%20Dividends) No interim dividend is proposed for the current period, while the 2024 final ordinary share dividend of RMB 0.05 per share was approved for distribution on June 2, 2025 - No interim dividend is proposed for the current period[21](index=21&type=chunk) - The 2024 final ordinary share dividend of **RMB 0.05 per share** (before tax), totaling approximately **RMB 177,121,000**, was approved for distribution on June 2, 2025[21](index=21&type=chunk) [3.8 Earnings Per Share Attributable to Ordinary Equity Holders of the Parent](index=12&type=section&id=3.8%20Earnings%20Per%20Share%20Attributable%20to%20Ordinary%20Equity%20Holders%20of%20the%20Parent) In H1 2025, basic and diluted earnings per share attributable to ordinary equity holders of the parent were RMB 0.38, a significant increase from the prior year, with no dilutive effect Summary of Earnings Per Share Calculation | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Profit attributable to ordinary equity holders of the parent (RMB thousands) | 1,316,682 | 412,379 | | Weighted average number of ordinary shares in issue (shares) | 3,478,194,000 | 3,320,437,000 | | Basic and diluted earnings per share (RMB yuan) | 0.38 | 0.12 | - Diluted earnings per share for the current period and H1 2024 were equal to basic earnings per share, with no dilutive effect[23](index=23&type=chunk) [3.9 Property, Plant and Equipment and Other Intangible Assets](index=12&type=section&id=3.9%20Property,%20Plant%20and%20Equipment%20and%20Other%20Intangible%20Assets) In H1 2025, the Group's original cost of property, plant and equipment and intangible assets increased, and total impairment losses of RMB 723,023,000 were recognized due to strategic adjustments and changes in operating plans Acquisition of Property, Plant and Equipment and Other Intangible Assets (RMB thousands) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Original cost of property, plant and equipment acquired | 1,016,586 | 839,691 | | Original cost of other intangible assets acquired | 282,858 | 110,707 | - Net book value of disposed property, plant and equipment totaled **RMB 2,496,000**, with a total net loss of **RMB 1,092,000**[25](index=25&type=chunk) - Due to strategic adjustments of mines and changes in operating plans, impairment losses totaling **RMB 723,023,000** were recognized for property, plant and equipment and other intangible assets of one mine in the gold mining segment and one smelter in the copper mining segment[26](index=26&type=chunk) [3.10 Trade and Bills Receivables](index=12&type=section&id=3.10%20Trade%20and%20Bills%20Receivables) As of June 30, 2025, total trade and bills receivables significantly increased, primarily concentrated within one year Summary of Trade and Bills Receivables (RMB thousands) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Trade receivables | 573,776 | 177,284 | | Bills receivables | 34,009 | 16,569 | | Impairment allowance | (22,625) | (17,879) | | Total | 585,160 | 175,974 | Aging Analysis of Trade and Bills Receivables (RMB thousands) | Aging | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Within 1 year | 560,522 | 166,283 | | 1 to 2 years | 18,299 | 4,816 | | 2 to 3 years | 4,378 | 3,103 | | Over 3 years | 1,961 | 1,772 | | Total | 585,160 | 175,974 | [3.11 Trade and Bills Payables](index=13&type=section&id=3.11%20Trade%20and%20Bills%20Payables) As of June 30, 2025, total trade and bills payables decreased, primarily concentrated within one year Summary of Trade and Bills Payables (RMB thousands) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Trade payables | 579,932 | 649,280 | | Bills payables | 179,360 | 176,438 | | Total | 759,292 | 825,718 | Aging Analysis of Trade and Bills Payables (RMB thousands) | Aging | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Within 1 year | 716,386 | 782,261 | | 1 to 2 years | 16,840 | 18,256 | | 2 to 3 years | 7,909 | 5,337 | | Over 3 years | 18,157 | 19,864 | | Total | 759,292 | 825,718 | [3.12 Share Capital](index=14&type=section&id=3.12%20Share%20Capital) As of June 30, 2025, the company's share capital increased due to the issuance of new H shares through placing, with net proceeds of approximately RMB 1,818,286 thousands Share Capital Composition (RMB thousands) | Category | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Domestic shares (660,837,607 shares) | 660,838 | 660,838 | | H shares (2,881,555,597 shares) | 2,881,555 | 2,741,555 | | Total | 3,542,393 | 3,402,393 | - On March 24, 2025, the company issued **140,000,000 new H shares** at **HKD 14.16 per share**, with net proceeds of approximately **HKD 1,970,337,000** (equivalent to **RMB 1,818,286,000**)[30](index=30&type=chunk) [3.13 Business Combinations](index=14&type=section&id=3.13%20Business%20Combinations) On January 7, 2025, the Group acquired 100% equity of Shandong Zeqing, which primarily invests in the Jinyi Gold Mine, as part of its strategy to expand business and enhance profitability, recognizing an investment gain of RMB 49,812,000 - On January 7, 2025, the Group acquired **100% equity** of Shandong Zeqing from other shareholders[31](index=31&type=chunk) - Shandong Zeqing's primary investment is an **85% equity interest** in Yantai Jinyi Mining Co., Ltd., which is a gold mine[32](index=32&type=chunk) - The acquisition consideration was paid in cash, with **RMB 398,468,000** paid on January 20, 2025[31](index=31&type=chunk) - The difference between the fair value and carrying amount of the Group's equity investment in the associate held prior to the acquisition date was recognized as an investment gain of approximately **RMB 49,812,000**[33](index=33&type=chunk) - Since the acquisition, Shandong Zeqing's contribution to consolidated profit for the six months ended June 30, 2025, was a loss of **RMB 9,548,000**[34](index=34&type=chunk) IV. [Business Review](index=17&type=section&id=IV.%20Business%20Review) This section reviews the Group's business performance, market environment, and strategic achievements during the reporting period [4.1 Macro Market Environment](index=17&type=section&id=4.1%20Macro%20Market%20Environment) In H1 2025, gold prices surged, reaching historical highs, with both London spot gold and Shanghai Gold Exchange AU9999 experiencing significant increases, supported by various factors - In H1 2025, gold prices rose strongly, reaching a high of **USD 3,500.10 per ounce**[42](index=42&type=chunk) Gold Price Performance | Indicator | End of June 2025 | H1 2025 Average | H1 2024 Average | | :--- | :--- | :--- | :--- | | London spot gold closing price (USD/ounce) | 3,302.96 | 3,077.0 | 2,205.98 | | Shanghai Gold Exchange AU9999 closing price (RMB yuan/gram) | 764.15 | 721.79 | 520.93 | - The average London spot gold price in H1 increased by **39.48%** year-on-year, and the weighted average Shanghai Gold Exchange AU9999 price in H1 increased by **38.56%** year-on-year[42](index=42&type=chunk) [4.2 Group Operating Strategy and Achievements](index=17&type=section&id=4.2%20Group%20Operating%20Strategy%20and%20Achievements) Amid high gold prices and industry consolidation opportunities, the Group focused on its core business, achieving breakthroughs in safety production, project construction, investment and M&A, and capital operations, leading to significant growth in market value and share price - The company's market value repeatedly hit new highs, with a cumulative increase of over **80%**, and the share price reached a maximum of **HKD 22.2 per share**, outperforming the industry market[43](index=43&type=chunk) [4.2.1 Strengthening Production and Operations](index=17&type=section&id=4.2.1%20Strengthening%20Production%20and%20Operations) The Group, guided by "optimized production, increased output, and enhanced efficiency," optimized resource allocation and accelerated capacity release, leading to significant growth in mined gold output and total profit Gold Output and Total Profit | Indicator | H1 2025 | | :--- | :--- | | Mined gold output | 10,235.63 kg (approx. 329,082.51 oz) | | Total profit | approx. RMB 2.249 billion | [4.2.2 Focusing on Project Implementation](index=18&type=section&id=4.2.2%20Focusing%20on%20Project%20Implementation) The Ruihai project accelerated infrastructure construction, with the beneficiation system successfully commissioned, and key projects like the Xiadian Gold Mine deep exploration progressing simultaneously, supporting capacity release - The Ruihai project's **12,000 tons/day** beneficiation system successfully underwent a one-time wet commissioning, initially possessing industrial production capacity[44](index=44&type=chunk) - Key projects for capacity enhancement at backbone mines, such as the deep exploration of Xiadian Gold Mine, are progressing simultaneously[44](index=44&type=chunk) [4.2.3 Deepening Exploration and Development](index=18&type=section&id=4.2.3%20Deepening%20Exploration%20and%20Development) The Group established a specialized exploration fund exceeding RMB 100 million, focusing on key metallogenic belts, adding 25 tons of gold metal, and successfully bidding for several key mining rights to expand resource reserves - Established a specialized exploration fund exceeding **RMB 100 million**, adding **25 tons** of gold metal through exploration[44](index=44&type=chunk) - Successfully bid for several key mining rights, opening up vast space for expanding resource reserves[44](index=44&type=chunk) [4.2.4 Refining Operations Management](index=18&type=section&id=4.2.4%20Refining%20Operations%20Management) The Group strengthened operational control, implemented "one enterprise, one topic" research projects, newly recognized 4 provincial innovative small and medium-sized enterprises, won 25 China Gold Association Science and Technology Innovation Awards, and successfully completed a 140 million share placement to secure funding - Implemented 'one enterprise, one topic,' with a batch of scientific research projects leading to innovative achievements, and newly recognized **4 provincial innovative small and medium-sized enterprises**[45](index=45&type=chunk) - Won **25 China Gold Association Science and Technology Innovation Awards**[45](index=45&type=chunk) - Successfully completed the placement of **140 million shares**, providing solid financial support for business expansion[45](index=45&type=chunk) [4.2.5 Strictly Adhering to Compliance Bottom Line](index=18&type=section&id=4.2.5%20Strictly%20Adhering%20to%20Compliance%20Bottom%20Line) In H1, the Group invested RMB 88 million in safety and environmental protection, passed audit-style safety inspections and environmental supervision with high standards, enhancing compliance awareness and management levels - In H1, completed special investment of **RMB 88 million** in safety and environmental protection[45](index=45&type=chunk) - Passed audit-style safety inspections and environmental supervision with high standards, enhancing compliance awareness and management levels[45](index=45&type=chunk) V. [Financial and Performance Analysis](index=19&type=section&id=V.%20Financial%20and%20Performance%20Analysis) This section provides a detailed analysis of the Group's financial performance and key operational metrics, including revenue, net profit, costs, and asset-liability structure [5.1 Revenue Analysis](index=19&type=section&id=5.1%20Revenue%20Analysis) In H1 2025, the Group's revenue increased by **50.69%** year-on-year to **RMB 6,972,841 thousands**, primarily due to higher gold sales prices and increased sales volume Revenue Comparison (RMB thousands) | Period | Amount | | :--- | :--- | | H1 2025 | 6,972,841 | | H1 2024 | 4,627,203 | | YoY Growth | 50.69% | - The main reasons for the increase in revenue were higher gold sales prices and increased sales volume by the Group[46](index=46&type=chunk) [5.2 Net Profit Analysis](index=19&type=section&id=5.2%20Net%20Profit%20Analysis) In H1 2025, the Group's net profit increased by **144.58%** year-on-year to **RMB 1,776,694 thousands**, primarily due to a substantial increase in gross profit from sales Net Profit Comparison (RMB thousands) | Period | Amount | | :--- | :--- | | H1 2025 | 1,776,694 | | H1 2024 | 726,420 | | YoY Growth | 144.58% | - The main reason for the increase in net profit was a substantial increase in the Group's gross profit from sales[47](index=47&type=chunk) [5.3 Comprehensive Cost Per Gram of Gold](index=19&type=section&id=5.3%20Comprehensive%20Cost%20Per%20Gram%20of%20Gold) In H1 2025, the comprehensive cost per gram of gold for the Group's domestic gold production enterprises increased by **2.96%** to **RMB 216.20 per gram**, mainly due to increased depreciation Comprehensive Cost Per Gram of Gold Comparison (RMB yuan/gram) | Period | Amount | | :--- | :--- | | H1 2025 | 216.20 | | H1 2024 | 209.99 | | YoY Increase | 2.96% | - The main reason for the increase in domestic comprehensive cost per gram of gold was increased depreciation[48](index=48&type=chunk) [5.4 Cost of Sales](index=19&type=section&id=5.4%20Cost%20of%20Sales) In H1 2025, the Group's cost of sales increased by **47.99%** year-on-year to **RMB 3,922,605 thousands**, primarily due to increased gold sales volume Cost of Sales Comparison (RMB thousands) | Period | Amount | | :--- | :--- | | H1 2025 | 3,922,605 | | H1 2024 | 2,650,560 | | YoY Growth | 47.99% | - The main reason for the increase in cost of sales was increased gold sales volume by the Group[49](index=49&type=chunk) [5.5 Gross Profit and Gross Profit Margin](index=19&type=section&id=5.5%20Gross%20Profit%20and%20Gross%20Profit%20Margin) In H1 2025, the Group's gross profit increased by **54.31%** year-on-year to **RMB 3,050,236 thousands**, and the gross profit margin rose to **43.74%**, primarily due to higher gold sales prices and increased sales volume Gross Profit and Gross Profit Margin Comparison | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Gross profit (RMB thousands) | 3,050,236 | 1,976,643 | | Gross profit margin | 43.74% | 42.72% | | YoY Gross Profit Growth | 54.31% | | - The main reason for the increase in gross profit was higher gold sales prices and increased sales volume by the Group[50](index=50&type=chunk) [5.6 Other Income and Gains](index=20&type=section&id=5.6%20Other%20Income%20and%20Gains) In H1 2025, the Group's other income and gains increased by **195.36%** year-on-year to **RMB 1,133,655 thousands**, primarily due to increased fair value changes in financial instruments Other Income and Gains Comparison (RMB thousands) | Period | Amount | | :--- | :--- | | H1 2025 | 1,133,655 | | H1 2024 | 383,824 | | YoY Growth | 195.36% | - The main reason for this increase was increased fair value changes in financial instruments[51](index=51&type=chunk) [5.7 Selling and Distribution Expenses](index=20&type=section&id=5.7%20Selling%20and%20Distribution%20Expenses) In H1 2025, the Group's selling and distribution expenses increased by **59.16%** year-on-year to **RMB 25,615 thousands**, primarily due to increased gold processing and transaction fees Selling and Distribution Expenses Comparison (RMB thousands) | Period | Amount | | :--- | :--- | | H1 2025 | 25,615 | | H1 2024 | 16,094 | | YoY Growth | 59.16% | - The main reason for this increase was increased gold processing and transaction fees by the Group[52](index=52&type=chunk) [5.8 Administrative Expenses and Other Operating Expenses](index=20&type=section&id=5.8%20Administrative%20Expenses%20and%20Other%20Operating%20Expenses) In H1 2025, the Group's administrative expenses and other operating expenses increased by **47.52%** year-on-year to **RMB 1,668,035 thousands**, primarily due to the impairment of property, plant and equipment recognized during the period Administrative Expenses and Other Operating Expenses Comparison (RMB thousands) | Period | Amount | | :--- | :--- | | H1 2025 | 1,668,035 | | H1 2024 | 1,130,721 | | YoY Growth | 47.52% | - The main reason for this increase was the impairment of property, plant and equipment recognized by the Group during the period[53](index=53&type=chunk) [5.9 Finance Costs](index=20&type=section&id=5.9%20Finance%20Costs) In H1 2025, the Group's finance costs decreased by **4.36%** year-on-year to **RMB 252,687 thousands**, primarily due to a decrease in the weighted average financing interest rate Finance Costs Comparison (RMB thousands) | Period | Amount | | :--- | :--- | | H1 2025 | 252,687 | | H1 2024 | 264,207 | | YoY Decrease | 4.36% | - This decrease was mainly due to a decrease in the Group's weighted average financing interest rate[54](index=54&type=chunk) [5.10 Liquidity and Capital Resources](index=20&type=section&id=5.10%20Liquidity%20and%20Capital%20Resources) The Group's working capital primarily comes from operating cash flow and borrowings; as of June 30, 2025, cash and cash equivalents significantly increased by **60.18%** to **RMB 3,251,368 thousands**, mainly for repaying upcoming debts - The Group's working capital and capital resources are primarily derived from operating cash flows and borrowings[55](index=55&type=chunk) Cash and Cash Equivalents Comparison (RMB thousands) | Date | Amount | | :--- | :--- | | June 30, 2025 | 3,251,368 | | December 31, 2024 | 2,029,825 | | Increase | 60.18% | - The increase in cash and cash equivalents was mainly due to reserved cash for repaying upcoming debts[55](index=55&type=chunk) - The Group can convert RMB into other currencies through banks authorized to conduct foreign currency business[57](index=57&type=chunk) [5.11 Borrowings](index=21&type=section&id=5.11%20Borrowings) As of June 30, 2025, the Group's total outstanding bank loans, other borrowings, and gold lease financing amounted to **RMB 13,388,122 thousands**, with most repayable within one year; all borrowings are denominated in RMB, and **64.08%** are at fixed interest rates Total Outstanding Borrowings and Maturity (RMB thousands) | Maturity | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total | 13,388,122 | 12,984,719 | | Repayable within 1 year | 9,457,042 | 7,573,647 | | Repayable within 2 to 5 years | 1,678,275 | 3,361,037 | | Repayable over 5 years | 2,252,805 | 2,050,035 | - All borrowings are denominated in RMB[59](index=59&type=chunk) - **64.08%** of the Group's interest-bearing bank borrowings and other borrowings are at fixed interest rates[59](index=59&type=chunk) [5.12 Income Tax](index=22&type=section&id=5.12%20Income%20Tax) In H1 2025, the Group's effective income tax rate was approximately **21.00%**, a decrease compared to the same period last year Effective Income Tax Rate Comparison | Period | Rate | | :--- | :--- | | H1 2025 | 21.00% | | H1 2024 | 23.78% | [5.13 Asset and Liability Structure](index=22&type=section&id=5.13%20Asset%20and%20Liability%20Structure) As of June 30, 2025, the Group's total assets, net assets, and total liabilities all increased, while the gearing ratio decreased, indicating a trend towards a more stable financial structure [5.13.1 Total Assets](index=22&type=section&id=5.13.1%20Total%20Assets) As of June 30, 2025, the Group's total assets increased by **8.78%** to **RMB 58,271,637 thousands**, with non-current assets accounting for **70.83%** Total Assets Comparison (RMB thousands) | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total assets | 58,271,637 | 53,567,945 | | Non-current assets | 41,276,095 | 39,676,995 | | Current assets | 16,995,542 | 13,890,950 | - Total assets increased by approximately **8.78%**, with non-current assets accounting for approximately **70.83%** of total assets[61](index=61&type=chunk) [5.13.2 Net Assets](index=22&type=section&id=5.13.2%20Net%20Assets) As of June 30, 2025, the Group's net assets increased by **9.51%** to **RMB 27,588,237 thousands** Net Assets Comparison (RMB thousands) | Date | Amount | | :--- | :--- | | June 30, 2025 | 27,588,237 | | December 31, 2024 | 25,192,291 | | Increase | 9.51% | [5.13.3 Total Liabilities](index=22&type=section&id=5.13.3%20Total%20Liabilities) As of June 30, 2025, the Group's total liabilities increased by **8.13%** to **RMB 30,683,400 thousands**, and the gearing ratio decreased to **41.18%** Total Liabilities and Gearing Ratio Comparison | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total liabilities (RMB thousands) | 30,683,400 | 28,375,654 | | Gearing ratio | 41.18% | 43.39% | [5.14 Contingent Liabilities](index=22&type=section&id=5.14%20Contingent%20Liabilities) As of June 30, 2025, there were no changes in the Group's contingent liabilities compared to December 31, 2024 - As of June 30, 2025, there were no changes in the Group's contingent liabilities compared to December 31, 2024[64](index=64&type=chunk) [5.15 Market Risks](index=22&type=section&id=5.15%20Market%20Risks) The Group faces market risks from fluctuations in gold and other commodity values, interest rates, and foreign currency exchange rates, which are managed through various means, but no interest rate swaps or foreign exchange hedging were conducted during this period - The Group is exposed to market risks from fluctuations in gold and other commodity values, interest rates, and foreign currency exchange rates[65](index=65&type=chunk) [5.15.1 Interest Rate Risk](index=23&type=section&id=5.15.1%20Interest%20Rate%20Risk) The Group manages interest rate risk by holding a portfolio of fixed and floating rate short-term deposits and borrowings, with no interest rate swaps used during this period - The Group manages interest rate risk by holding a portfolio of fixed and floating rate short-term deposits, and simultaneously holding fixed and floating rate bank borrowings[66](index=66&type=chunk) - The Group did not use any interest rate swaps to hedge its interest rate risk during this period[67](index=67&type=chunk) [5.15.2 Foreign Exchange Risk](index=23&type=section&id=5.15.2%20Foreign%20Exchange%20Risk) Most of the Group's transactions are denominated in RMB, and fluctuations in the RMB to USD exchange rate may affect gold prices and operating results, with no foreign exchange hedging conducted during this period - Most of the Group's transactions are denominated in RMB[68](index=68&type=chunk) - Fluctuations in the RMB to USD exchange rate may affect international and local gold prices, thereby impacting the Group's operating results[68](index=68&type=chunk) - During this period, the Group did not engage in any hedging activities due to exchange rate fluctuations[69](index=69&type=chunk) [5.15.3 Gold Price and Other Commodity Value Risk](index=23&type=section&id=5.15.3%20Gold%20Price%20and%20Other%20Commodity%20Value%20Risk) The Group's price risk is primarily related to fluctuations in gold market prices, which are hedged through AU(T+D) contracts and gold futures contracts, with reasonable fluctuations having no significant impact on profit and equity - The Group's price risk is primarily related to fluctuations in gold market prices[70](index=70&type=chunk) - During this period, the Group engaged in AU(T+D) contract transactions on the Shanghai Gold Exchange and entered into gold futures contracts to hedge against gold price fluctuations[70](index=70&type=chunk) - A reasonable **10%** fluctuation in commodity prices would not have a significant impact on the Group's profit and equity during this period[71](index=71&type=chunk) [5.16 Pledges](index=23&type=section&id=5.16%20Pledges) As of June 30, 2025, the Group's pledged deposits amounted to **RMB 596,334 thousands**, serving as guarantees or collateral for bank loans and bills payable Pledged Deposits Comparison (RMB thousands) | Date | Amount | | :--- | :--- | | June 30, 2025 | 596,334 | | December 31, 2024 | 625,805 | - Pledged deposits serve as environmental governance guarantees, futures trading margins, AU(T+D) contract margins, or collateral for bank loans and bills payable[72](index=72&type=chunk) VI. [Business Outlook](index=24&type=section&id=VI.%20Business%20Outlook) This section outlines the Group's strategic objectives and key initiatives for the second half of the year, focusing on innovation, capacity growth, resource expansion, and risk management [6.1 Overall Objectives](index=24&type=section&id=6.1%20Overall%20Objectives) In the second half, the Group will target annual operating goals, comprehensively plan for innovation-driven and capacity growth, continuously strengthen external development and exploration for increased reserves, firmly adhere to development bottom lines, and deeply implement "Four Focuses" to achieve a high-quality year-end - In the second half, the Group will target annual operating goals, comprehensively plan for innovation-driven and capacity growth, and continuously strengthen external development and exploration for increased reserves[73](index=73&type=chunk) - Deeply implement the 'Four Focuses' to achieve a high-quality year-end[73](index=73&type=chunk) [6.2 Focusing on Production Increase and Capacity Expansion](index=24&type=section&id=6.2%20Focusing%20on%20Production%20Increase%20and%20Capacity%20Expansion) The Group will continuously increase production and expand capacity through technical renovation projects and optimized operating procedures, intensify production exploration, expand resource reserves, and optimize asset structure to strengthen its core business - Continuously increase production and expand capacity by implementing technical renovation projects and optimizing operating procedures[73](index=73&type=chunk) - Intensify production exploration, promoting 'edge-finding, deep-probing, and blind-spot-attacking' in key mines like Xiadian Gold Mine to expand resource reserves[73](index=73&type=chunk) - Implement 'streamlining and strengthening' actions, optimizing asset structure to strengthen the core business[73](index=73&type=chunk) [6.3 Focusing on Project Construction](index=24&type=section&id=6.3%20Focusing%20on%20Project%20Construction) The Group will establish a "daily dispatch, weekly report, monthly assessment" mechanism, prioritize the Ruihai Mining project infrastructure, and enhance the efficiency of the Abuja Gold Mine beneficiation method to increase the contribution of overseas segments - Establish a 'daily dispatch, weekly report, monthly assessment' mechanism to ensure all projects are implemented as planned[74](index=74&type=chunk) - Prioritize the Ruihai Mining project, ensuring its infrastructure meets progress requirements[74](index=74&type=chunk) - Enhance the efficiency of the Abuja Gold Mine beneficiation method to increase the contribution of overseas segments[74](index=74&type=chunk) [6.4 Focusing on Quality Improvement and Efficiency Enhancement](index=24&type=section&id=6.4%20Focusing%20on%20Quality%20Improvement%20and%20Efficiency%20Enhancement) The Group will promote full-process, comprehensive, and all-staff cost control, achieve cost reduction and efficiency improvement targets in four major areas, and accelerate the resolution of major issues and key scientific research projects to transform technological achievements into productivity - Promote full-process, comprehensive, and all-staff cost control, achieving cost reduction and efficiency improvement targets in the four major areas of 'engineering, projects, electricity consumption, and material procurement'[74](index=74&type=chunk) - Accelerate the resolution of **20 major annual issues** and **14 key scientific research projects**, transforming technological achievements into productivity[74](index=74&type=chunk) [6.5 Focusing on Bottom-Line Work](index=24&type=section&id=6.5%20Focusing%20on%20Bottom-Line%20Work) The Group will continue to practice ESG principles, conduct special rectification actions for safety and environmental hazards, upgrade emergency response capabilities, and strengthen multi-dimensional supervision in discipline inspection, finance, and audit to strictly adhere to laws, regulations, and regulatory requirements - Continue to practice ESG principles, conduct special rectification actions for safety and environmental hazards, and upgrade emergency response capabilities[75](index=75&type=chunk) - Strengthen multi-dimensional supervision in discipline inspection, finance, and audit to strictly adhere to laws, regulations, and regulatory requirements, achieving stable development[75](index=75&type=chunk) VII. [Other Information](index=25&type=section&id=VII.%20Other%20Information) This section provides additional information, including shareholder holdings, public float, securities transactions, employee details, significant events, and corporate governance matters [7.1 Shareholder Holdings and Changes in Equity Structure](index=25&type=section&id=7.1%20Shareholder%20Holdings%20and%20Changes%20in%20Equity%20Structure) As of June 30, 2025, the company had a total of 1,212 shareholders, comprising 1 domestic share shareholder and 1,211 H share shareholders [7.1.1 Number of Shareholders](index=25&type=section&id=7.1.1%20Number%20of%20Shareholders) As of June 30, 2025, the company had a total of 1,212 shareholders Number of Shareholders | Category | Number of Shareholders | | :--- | :--- | | Domestic shares | 1 | | Overseas listed foreign shares – H shares | 1,211 | | Total number of shareholders | 1,212 | [7.2 Sufficient Public Float](index=25&type=section&id=7.2%20Sufficient%20Public%20Float) The company confirms that it maintained a sufficient public float of its shares throughout the period and up to the date of this announcement - The company confirms that it maintained a sufficient public float of its shares throughout the period and up to the date of this announcement[77](index=77&type=chunk) [7.3 Purchase, Sale or Redemption of the Company's Listed Securities](index=25&type=section&id=7.3%20Purchase,%20Sale%20or%20Redemption%20of%20the%20Company's%20Listed%20Securities) During the period, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities, and no treasury shares were held at period-end - During the period, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities[78](index=78&type=chunk) - At the end of the period, the company did not hold any treasury shares[78](index=78&type=chunk) [7.4 Convertible Securities, Share Options, Warrants or Similar Rights](index=25&type=section&id=7.4%20Convertible%20Securities,%20Share%20Options,%20Warrants%20or%20Similar%20Rights) The company did not issue any convertible securities, share options, warrants, or similar rights during the period, and the Group has no share option scheme - The company did not issue any convertible securities, share options, warrants, or similar rights during this period[79](index=79&type=chunk) - As of the date of this announcement, the Group has no share option scheme[79](index=79&type=chunk) [7.5 Employees](index=26&type=section&id=7.5%20Employees) As of June 30, 2025, the company had 6,990 employees, offering competitive compensation packages, retirement benefits, medical benefits, housing provident funds, and learning and training opportunities - As of June 30, 2025, the company had **6,990 employees**[80](index=80&type=chunk) - The Group determines employee remuneration based on performance, experience, and industry practice, and provides retirement benefit plans, medical benefit plans, housing provident fund plans, and other benefits[80](index=80&type=chunk) [7.6 Significant Events](index=26&type=section&id=7.6%20Significant%20Events) During the period, the company held several general meetings, approving resolutions such as re-election of directors and supervisors, remuneration schemes, guarantees for subsidiaries, and issuance of perpetual medium-term notes; it also issued ultra-short-term financing bonds and medium-term notes, and completed H-share placement and capital increase in Shandong Ruijin [7.6.1 Convening the First Extraordinary General Meeting in 2025](index=26&type=section&id=7.6.1%20Convening%20the%20First%20Extraordinary%20General%20Meeting%20in%202025) On February 26, 2025, the company held its first extraordinary general meeting, approving resolutions including the re-election of directors and shareholder representative supervisors for the eighth board, remuneration schemes, guarantees for subsidiaries, and the issuance of perpetual medium-term notes not exceeding RMB 6 billion - Reviewed and approved the re-election of Mr. Jiang Guipeng, Mr. Duan Lei, Mr. Wang Ligang, and Mr. Wang Peiwu as executive directors[81](index=81&type=chunk) - Reviewed and approved providing guarantees for subsidiaries with a debt-to-asset ratio exceeding **70%**[83](index=83&type=chunk) - Reviewed and approved the proposal to issue perpetual medium-term notes not exceeding **RMB 6 billion** in China[82](index=82&type=chunk) [7.6.2 Convening the 2024 Annual General Meeting](index=28&type=section&id=7.6.2%20Convening%20the%202024%20Annual%20General%20Meeting) On June 2, 2025, the company held its 2024 Annual General Meeting, approving resolutions including the 2024 profit distribution plan (a dividend of RMB 0.05 per share), general mandates to allot, issue, and repurchase shares, and amendments to the Articles of Association - Approved the 2024 profit distribution plan, which proposed a final dividend of **RMB 0.05 per share** (before tax) to all shareholders[86](index=86&type=chunk) - Granted a general mandate to the Board to allot, issue, and/or deal with shares not exceeding **20%** of the total number of H shares and existing domestic shares of the company as of the date of passing the resolution[86](index=86&type=chunk) - Granted a general mandate to the Board to repurchase shares not exceeding **10%** of the total number of H shares of the company as of the date of passing the resolution[86](index=86&type=chunk) [7.6.3 Convening the 2024 Domestic Share Class Meeting and H Share Class Meeting](index=28&type=section&id=7.6.3%20Convening%20the%202024%20Domestic%20Share%20Class%20Meeting%20and%20H%20Share%20Class%20Meeting) On June 2, 2025, the company held its Domestic Share Class Meeting and H Share Class Meeting, respectively approving resolutions such as granting a general mandate to the Board to repurchase H shares and amending the Articles of Association - Granted a general mandate to the Board to repurchase shares not exceeding **10%** of the total number of H shares of the company as of the date of passing the resolution[87](index=87&type=chunk) - Proposed amendments to Article 3.5 and Article 3.6 of the Articles of Association[87](index=87&type=chunk) [7.6.4 Issuance of Ultra-Short-Term Financing Bonds](index=29&type=section&id=7.6.4%20Issuance%20of%20Ultra-Short-Term%20Financing%20Bonds) The company issued two tranches of ultra-short-term financing bonds in January and February 2025, totaling **RMB 3 billion**, used to repay interest-bearing debts Ultra-Short-Term Financing Bonds Issuance Details | Tranche | Issue Date | Face Value (RMB) | Term | Annual Interest Rate | Purpose | | :--- | :--- | :--- | :--- | :--- | :--- | | First Tranche | January 20, 2025 | 1 billion | 270 days | 1.91% | Repay interest-bearing debts | | Second Tranche | February 25, 2025 | 2 billion | 269 days | 2.05% | Repay interest-bearing debts | [7.6.5 Issuance of Medium-Term Notes](index=29&type=section&id=7.6.5%20Issuance%20of%20Medium-Term%20Notes) On June 11, 2025, the company issued its first tranche of 2025 technology innovation bonds, with a face value of **RMB 1 billion**, a 3-year term, and an annual interest rate of **1.86%**, used to repay interest-bearing debts Medium-Term Notes Issuance Details | Tranche | Issue Date | Face Value (RMB) | Term | Annual Interest Rate | Purpose | | :--- | :--- | :--- | :--- | :--- | :--- | | First Tranche Technology Innovation Bonds | June 11, 2025 | 1 billion | 3 years | 1.86% | Repay interest-bearing debts | [7.6.6 Capital Increase in Shandong Ruijin](index=30&type=section&id=7.6.6%20Capital%20Increase%20in%20Shandong%20Ruijin) On March 21, 2025, the company and Zijin Investment entered into a capital increase agreement, investing a total of approximately **RMB 689.07 million** in Shandong Ruijin, with the company contributing approximately **RMB 482.35 million**, maintaining its **70%** equity stake after the capital increase; this is a connected transaction but exempt from circular and independent shareholder approval - The company and Zijin Investment will contribute a total of approximately **RMB 689.07 million** to Shandong Ruijin according to their respective shareholding percentages, with the company contributing approximately **RMB 482.35 million**[90](index=90&type=chunk) - After the capital increase, the company and Zijin Investment will continue to hold **70%** and **30%** equity interests in Shandong Ruijin, respectively[90](index=90&type=chunk) - This transaction constitutes a connected transaction, but due to the applicable percentage ratios being less than **5%**, it is exempt from circular and independent shareholder approval requirements[91](index=91&type=chunk) [7.6.7 Completion of Placing of New H Shares under General Mandate](index=31&type=section&id=7.6.7%20Completion%20of%20Placing%20of%20New%20H%20Shares%20under%20General%20Mandate) On March 31, 2025, the company completed the placing of **140,000,000 new H shares**, with net proceeds of approximately **HKD 1,970.3 million**, to be used for supplementing working capital and repaying bank loans - The company issued **140,000,000 new H shares** to no less than six placees at a placing price of **HKD 14.16 per share**[93](index=93&type=chunk) - The placing was completed on March 31, 2025, with net proceeds of approximately **HKD 1,970.3 million**[94](index=94&type=chunk) - The net proceeds from the placing will be used to supplement the company's working capital and repay bank loans[94](index=94&type=chunk) [7.7 Post-Balance Sheet Events](index=31&type=section&id=7.7%20Post-Balance%20Sheet%20Events) Subsequent to the reporting period, the company continued to issue ultra-short-term financing bonds and medium-term notes to repay interest-bearing debts, and proposed amendments to its Articles of Association and Rules of Procedure for General Meetings to comply with the latest regulations [7.7.1 Issuance of Ultra-Short-Term Financing Bonds](index=31&type=section&id=7.7.1%20Issuance%20of%20Ultra-Short-Term%20Financing%20Bonds) On July 25, 2025, the company issued its third tranche of 2025 technology innovation bonds, with a face value of **RMB 1 billion**, a 183-day term, and an annual interest rate of **1.58%**, used to repay interest-bearing debts Post-Balance Sheet Ultra-Short-Term Financing Bonds Issuance Details | Tranche | Issue Date | Face Value (RMB) | Term | Annual Interest Rate | Purpose | | :--- | :--- | :--- | :--- | :--- | :--- | | Third Tranche Technology Innovation Bonds | July 25, 2025 | 1 billion | 183 days | 1.58% | Repay interest-bearing debts | [7.7.2 Issuance of Medium-Term Notes](index=31&type=section&id=7.7.2%20Issuance%20of%20Medium-Term%20Notes) On August 7, 2025, the company issued its fourth tranche of 2025 technology innovation bonds, with a face value of **RMB 1 billion**, a 3-year term, and an annual interest rate of **1.8%**, used to repay interest-bearing debts Post-Balance Sheet Medium-Term Notes Issuance Details | Tranche | Issue Date | Face Value (RMB) | Term | Annual Interest Rate | Purpose | | :--- | :--- | :--- | :--- | :--- | :--- | | Fourth Tranche Technology Innovation Bonds | August 7, 2025 | 1 billion | 3 years | 1.8% | Repay interest-bearing debts | [7.7.3 Proposed Amendments to the Articles of Association and Rules of Procedure for General Meetings](index=32&type=section&id=7.7.3%20Proposed%20Amendments%20to%20the%20Articles%20of%20Association%20and%20Rules%20of%20Procedure%20for%20General%20Meetings) The Board approved proposed amendments to the Articles of Association and Rules of Procedure for General Meetings, primarily to remove content related to supervisors and the supervisory board, to comply with the latest regulatory requirements - Proposed amendments to the Articles of Association and Rules of Procedure for General Meetings to comply with the latest provisions of the 'Company Law of the People's Republic of China' and other relevant laws and regulations[97](index=97&type=chunk) - The main content includes the removal of provisions related to the company's supervisors and supervisory board[97](index=97&type=chunk) - The proposed amendments will be submitted to the upcoming Second Extraordinary General Meeting in 2025 for consideration[98](index=98&type=chunk) [7.8 Compliance with the Corporate Governance Code](index=32&type=section&id=7.8%20Compliance%20with%20the%20Corporate%20Governance%20Code) The company complied with the Corporate Governance Code in H1 2025, with a deviation regarding independent non-executive directors serving over nine years; the Board believes their long tenure enhances independence through deep business understanding - The company has complied with the 'Corporate Governance Code' set out in Appendix C1 of the Listing Rules for the period from January 1, 2025, to June 30, 2025, except for a deviation from Code Provision B.2.4(b)[99](index=99&type=chunk) - All four independent non-executive directors have served on the Board for more than nine years, and the company needs to appoint a new independent non-executive director[100](index=100&type=chunk) - The Board believes that the long tenure of the existing independent non-executive directors has not undermined their independence, but rather enables them to provide impartial opinions and tailored advice due to their deep understanding of the business[100](index=100&type=chunk) [7.9 Compliance with the Model Code for Securities Transactions by Directors of Listed Issuers](index=33&type=section&id=7.9%20Compliance%20with%20the%20Model%20Code%20for%20Securities%20Transactions%20by%20Directors%20of%20Listed%20Issuers) The company adopted the Model Code as the standard for securities transactions by its directors and supervisors, and all directors and supervisors fully complied with the code during the period - The company has adopted the 'Model Code' set out in Appendix C3 of the Listing Rules as the standard for securities transactions by its directors and supervisors during this period[101](index=101&type=chunk) - All directors and supervisors of the company have fully complied with the required standards of the Model Code during this period[101](index=101&type=chunk) [7.10 Audit Committee](index=34&type=section&id=7.10%20Audit%20Committee) The Audit Committee, composed of three independent non-executive directors, is responsible for internal control and financial reporting matters, and has reviewed this interim report, deeming it compliant with applicable accounting standards and legal requirements - The Audit Committee members include three independent non-executive directors: Ms. Chen Jinrong (Chairperson), Mr. Wei Junhao, and Mr. Cai Sicong[102](index=102&type=chunk) - The Audit Committee's primary responsibilities include internal control and financial reporting matters, and reviewing the accounting principles, standards, and methods adopted by the company with management[102](index=102&type=chunk) - The Audit Committee has reviewed the company's unaudited interim report and interim results announcement for the six months ended June 30, 2025, and considers them to be prepared in accordance with applicable accounting standards and legal requirements, with appropriate disclosures made[102](index=102&type=chunk) [7.11 Board Members](index=34&type=section&id=7.11%20Board%20Members) As of the date of this announcement, the Board members include executive directors Mr. Jiang Guipeng, Mr. Duan Lei, Mr. Wang Ligang, and Mr. Wang Peiwu; non-executive directors Mr. Long Yi, Mr. Li Guanghui, and Mr. Luan Wenjing; and independent non-executive directors Ms. Chen Jinrong, Mr. Cai Sicong, Mr. Wei Junhao, and Mr. Shen Shifu - As of the date of this announcement, the Board members include executive directors Mr. Jiang Guipeng, Mr. Duan Lei, Mr. Wang Ligang, and Mr. Wang Peiwu[103](index=103&type=chunk) - Non-executive directors include Mr. Long Yi, Mr. Li Guanghui, and Mr. Luan Wenjing[103](index=103&type=chunk) - Independent non-executive directors include Ms. Chen Jinrong, Mr. Cai Sicong, Mr. Wei Junhao, and Mr. Shen Shifu[103](index=103&type=chunk)

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不 負責，對其準確性或完整性亦不發表任何聲明，並明確表示，概不對因本公 告全部或任何部分內容而產生或因倚賴該等內容而引致的任何損失承擔任何 責任。 Chifeng Jilong Gold Mining Co., Ltd. 赤峰吉隆黃金礦業股份有限公司 （H股股份代號：6693） （於中華人民共和國註冊成立的股份有限公司） 截至2025年6月30日止六個月的 未經審計中期業績公告 本集團財務摘要 截至2025年6月30日止6個月，本集團實現營業收入人民幣52.72億元，同比增 長25.64%（上年同期：人民幣41.96億元）。 截至2025年6月30日止6個月，本集團歸屬於母公司股東的淨利潤為人民幣 11.07億元，同比增長55.79%（上年同期：人民幣7.10億元）。 於2025年6月30日，本集團總資產為人民幣231.68億元，較年初增長13.97% （年初：人民幣203.29億元）。 於2025年6月30日，本集團歸屬於母公司股東的淨資產為人民幣116.06億元， 較年初增長46.61%（年初：人民幣79.17億元）。 1 本公司董事會欣然宣 ...

[Financial Summary](index=1&type=section&id=Financial%20Summary) [Interim Results Overview](index=1&type=section&id=Interim%20Results%20Overview) The Group's unaudited interim results for the six months ended June 30, 2025, show significant revenue growth but a decline in gross margin, alongside a substantial increase in profit attributable to owners of the parent | Metric | Six Months Ended June 30, 2025 (RMB million) | Six Months Ended June 30, 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 888.3 | 655.8 | +35.5% | | Gross Profit | 229.3 | 234.8 | -2.3% | | Gross Margin | 25.8% | 35.8% | -10.0pp | | Profit attributable to owners of the parent | 93.8 | 33.7 | +178.3% | | Earnings per share (basic and diluted) | 5.85 cents | 2.09 cents | +179.9% | [Condensed Consolidated Interim Financial Statements](index=2&type=section&id=Condensed%20Consolidated%20Interim%20Financial%20Statements) [Condensed Consolidated Interim Statement of Profit or Loss and Other Comprehensive Income](index=2&type=section&id=Condensed%20Consolidated%20Interim%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) The Group's statement of profit or loss for the six months ended June 30, 2025, shows significant revenue and other income growth, leading to a substantial increase in profit before tax and profit for the period, despite a decline in gross profit | Metric | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue | 888,320 | 655,758 | | Cost of sales | (659,066) | (420,974) | | Gross profit | 229,254 | 234,784 | | Other income and gains | 130,747 | 34,335 | | Selling and distribution costs | (60,862) | (47,940) | | Administrative expenses | (106,074) | (83,660) | | Research and development costs | (67,923) | (67,756) | | Profit before tax | 112,808 | 36,349 | | Profit for the period | 85,470 | 20,933 | | Profit attributable to owners of the parent | 93,773 | 33,722 | | Total comprehensive income attributable to owners of the parent | 82,452 | 33,012 | [Condensed Consolidated Interim Statement of Financial Position](index=4&type=section&id=Condensed%20Consolidated%20Interim%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group's financial position shows increases in both total non-current and current assets, with steady growth in net assets and a corresponding rise in total equity | Metric | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Total non-current assets | 1,030,009 | 1,012,660 | | Total current assets | 2,040,579 | 2,022,187 | | Total current liabilities | 920,425 | 935,050 | | Net current assets | 1,120,154 | 1,087,137 | | Net assets | 2,057,990 | 1,995,956 | | Total equity | 2,057,990 | 1,995,956 | [Notes to the Condensed Consolidated Interim Financial Statements](index=6&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Interim%20Financial%20Statements) [Company Information](index=6&type=section&id=Company%20Information) The Company, incorporated in the Cayman Islands and listed on the HKEX, primarily engages in trading and manufacturing power electronic components, with financial information presented in RMB - The Group's principal activities are the trading and manufacturing of power electronic components[10](index=10&type=chunk) - The condensed consolidated interim financial information is presented in RMB[11](index=11&type=chunk) [Changes in Accounting Policies](index=6&type=section&id=Changes%20in%20Accounting%20Policies) Accounting policies adopted this period are consistent with the prior year, with the initial adoption of IAS 21 (Amendment) "Lack of Exchangeability" having no financial impact due to the Group's convertible transaction currencies - The adoption of IAS 21 (Amendment) "Lack of Exchangeability" had no impact on the condensed consolidated interim financial information, as the Group's transaction currencies are convertible[13](index=13&type=chunk) [Operating Segment Information](index=6&type=section&id=Operating%20Segment%20Information) The Group operates a single reportable segment, manufacturing and trading power electronic components, with over 95% of revenue and non-current assets attributable to mainland China, thus no other geographical segment information is provided - The Group has only one reportable operating segment, primarily engaged in the manufacturing and trading of power electronic components[14](index=14&type=chunk) - Over **95% of the Group's revenue** and all non-current assets are attributable to mainland China[15](index=15&type=chunk) [Revenue, Other Income and Gains](index=7&type=section&id=Revenue%2C%20Other%20Income%20and%20Gains) The Group's revenue primarily stems from the sale of power electronic components, with other income and gains significantly increasing due to government subsidies, exchange gains, and fair value gains from forward foreign exchange contracts Customer Contract Revenue | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Sale of power electronic components | 888,320 | 655,758 | Other Income and Gains | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Government subsidies | 33,270 | 20,348 | | Net exchange gains | 31,342 | – | | Net fair value gains from forward foreign exchange contracts | 59,939 | – | | Total | 130,747 | 34,335 | - Government subsidies primarily originate from mainland China's incentives for investment and technological advancement, with no unfulfilled conditions or contingencies[16](index=16&type=chunk) [Profit Before Tax](index=8&type=section&id=Profit%20Before%20Tax) The Group's profit before tax is achieved after deducting items such as cost of inventories sold, depreciation, amortization, and impairment, with a significant increase in cost of inventories sold and a substantial reduction in net fair value losses from forward foreign exchange contracts and net exchange losses Key Deductions/Additions to Profit Before Tax | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Cost of inventories sold | 659,985 | 420,321 | | Depreciation of property, plant and equipment | 26,187 | 21,413 | | Net impairment losses on trade receivables and contract assets | 3,118 | 1,622 | | Net fair value losses from forward foreign exchange contracts | – | 10,648 | | Net exchange losses | – | 11,366 | [Finance Costs](index=8&type=section&id=Finance%20Costs) The Group's finance costs, primarily comprising interest on bank loans, other loans, and lease liabilities, show a slight overall increase Analysis of Finance Costs | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Interest on bank loans | 4,471 | 4,130 | | Interest on other loans | 4,241 | 4,265 | | Interest on lease liabilities | 123 | 146 | | Total | 8,835 | 8,541 | [Income Tax Expense](index=9&type=section&id=Income%20Tax%20Expense) The Group's income tax expense is calculated based on tax rates in different jurisdictions, with a 25% corporate income tax rate in mainland China and a 15% preferential rate for certain high-tech enterprises, resulting in a significant increase in total tax expense for the period - The corporate income tax rate in mainland China is **25%**, with certain high-tech enterprises enjoying a **15% preferential tax rate**[19](index=19&type=chunk) Total Tax Expense for the Period | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Subtotal of current tax expense | 17,882 | 16,032 | | Deferred tax | 9,456 | (616) | | Total tax expense for the period | 27,338 | 15,416 | [Dividends](index=9&type=section&id=Dividends) The Board has declared an interim dividend of HK$0.01 per ordinary share for the six months ended June 30, 2025, with no dividend declared for the corresponding period last year - The Board declared an interim dividend of **HK$0.01 per ordinary share**, totaling approximately **RMB14,531,000**[20](index=20&type=chunk) - No interim dividend was declared for the corresponding period in 2024[20](index=20&type=chunk) [Earnings Per Share Attributable to Ordinary Equity Holders of the Parent](index=10&type=section&id=Earnings%20Per%20Share%20Attributable%20to%20Ordinary%20Equity%20Holders%20of%20the%20Parent) Both basic and diluted earnings per share significantly increased, primarily due to a substantial rise in profit attributable to ordinary equity holders of the parent, coupled with a slight decrease in the weighted average number of ordinary shares outstanding - Basic earnings per share are calculated based on profit attributable to ordinary equity holders of the parent of **RMB93,773,000** (2024: RMB33,722,000)[21](index=21&type=chunk) Basis for Earnings Per Share Calculation | Metric | 2025 (RMB thousand/share) | 2024 (RMB thousand/share) | | :--- | :--- | :--- | | Profit attributable to ordinary equity holders of the parent | 93,773 | 33,722 | | Weighted average number of ordinary shares outstanding for basic EPS | 1,603,302,772 | 1,616,157,705 | | Dilutive effect - share options | 643,752 | 370,317 | | Total (diluted shares) | 1,603,946,524 | 1,616,528,022 | [Trade and Bills Receivables](index=11&type=section&id=Trade%20and%20Bills%20Receivables) The Group's total trade and bills receivables slightly decreased, with credit terms typically ranging from one to three months, and strict credit controls in place to mitigate risks - Total trade and bills receivables amounted to **RMB1,147,053 thousand**, a slight decrease compared to December 31, 2024[23](index=23&type=chunk) - Credit terms are typically one month, extendable to three months for major customers, with a credit control department to minimize credit risk[23](index=23&type=chunk) Ageing Analysis of Trade Receivables (Net of Impairment Provisions) | Ageing | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Within 3 months | 567,263 | 518,522 | | 4 to 6 months | 172,174 | 188,948 | | 7 to 12 months | 138,302 | 117,107 | | Over 1 year | 89,039 | 82,067 | | Total | 966,778 | 906,644 | [Trade and Bills Payables](index=11&type=section&id=Trade%20and%20Bills%20Payables) The Group's total trade and bills payables increased, with a notable rise in payables outstanding for over six months Ageing Analysis of Trade and Bills Payables | Ageing | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Within 6 months | 338,705 | 366,017 | | Over 6 months | 95,311 | 50,707 | | Total | 434,016 | 416,724 | [Business Review](index=12&type=section&id=Business%20Review) [Domestic and Overseas Market Performance](index=12&type=section&id=Domestic%20and%20Overseas%20Market%20Performance) The Group's domestic market revenue grew significantly but gross margin declined substantially, while overseas market revenue and gross margin both maintained stable growth Domestic and Overseas Market Performance | Market | 2025 Revenue (RMB thousand) | 2025 Gross Margin | 2024 Revenue (RMB thousand) | 2024 Gross Margin | | :--- | :--- | :--- | :--- | :--- | | Domestic Market | 845,968 | 24.7% | 617,047 | 35.1% | | Overseas Market | 42,352 | 47.4% | 38,711 | 46.9% | | Total | 888,320 | 25.8% | 655,758 | 35.8% | [Domestic Market Performance](index=12&type=section&id=Domestic%20Market%20Performance) Domestic market revenue, segmented by application, shows significant growth in power transmission and distribution and industrial and other sectors, but a decline in electrified transportation, with a general decrease in gross margins across all segments Domestic Market Performance by Application Segment | Application Segment | 2025 Revenue (RMB thousand) | 2025 Gross Margin | 2024 Revenue (RMB thousand) | 2024 Gross Margin | | :--- | :--- | :--- | :--- | :--- | | Power Transmission and Distribution | 466,654 | 35.4% | 358,098 | 47.8% | | Electrified Transportation | 23,641 | 15.6% | 31,840 | 23.1% | | Industrial and Other | 355,673 | 11.3% | 227,109 | 16.7% | | Total | 845,968 | 24.7% | 617,047 | 35.1% | [Power Transmission and Distribution Segment](index=13&type=section&id=Power%20Transmission%20and%20Distribution%20Segment) Revenue in the power transmission and distribution segment grew by 30%, driven by a 123% surge in flexible transmission, while conventional DC transmission revenue declined by 39% due to fewer order deliveries Power Transmission and Distribution Segment Revenue Change | Sub-segment | 2025 Revenue (RMB thousand) | 2024 Revenue (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Conventional DC Transmission | 89,205 | 146,945 | -39% | | Flexible Transmission | 295,960 | 132,914 | 123% | | Other Power Transmission and Distribution | 81,489 | 78,239 | 4% | | Total | 466,654 | 358,098 | 30% | - Conventional DC transmission revenue decreased primarily due to fewer ordered products delivered compared to the same period last year[33](index=33&type=chunk) - Flexible transmission revenue growth was mainly driven by the progressive delivery of ordered products for the Saudi Central-South Project, Gan-Dian-Ru-Zhe Project, and Peru/Chile Distributed Power Flow Controller Project[34](index=34&type=chunk) [Electrified Transportation Segment](index=14&type=section&id=Electrified%20Transportation%20Segment) Overall revenue in the electrified transportation segment decreased by 26%, with significant reductions in rail transit and electric vehicle sub-segments, but a 100% increase in other transportation (e.g., electrified shipping) Electrified Transportation Segment Revenue Change | Sub-segment | 2025 Revenue (RMB thousand) | 2024 Revenue (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Rail Transit | 17,532 | 27,712 | -37% | | Electric Vehicles | 44 | 1,097 | -96% | | Other Transportation | 6,065 | 3,031 | 100% | | Total | 23,641 | 31,840 | -26% | - Rail transit revenue decreased primarily due to reduced orders from rail transit vehicle equipment manufacturers[36](index=36&type=chunk) - Electric vehicle revenue decreased primarily due to reduced orders in the electric vehicle industry[36](index=36&type=chunk) - Other transportation revenue increased primarily due to increased orders in the electrified shipping industry[36](index=36&type=chunk) [Industrial and Other Segments](index=15&type=section&id=Industrial%20and%20Other%20Segments) Revenue in the industrial and other segments grew by 57%, primarily driven by increased sales of self-developed power semiconductors, laminated busbars, and DC-link capacitors, as well as higher revenue from new energy power station construction-related businesses Industrial and Other Segments Revenue Change | Sub-segment | 2025 Revenue (RMB thousand) | 2024 Revenue (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Industrial Control | 196,368 | 151,130 | 30% | | New Energy Generation and Storage | 156,382 | 75,345 | 108% | | Research Institutes and Others | 2,923 | 634 | 361% | | Total | 355,673 | 227,109 | 57% | - Revenue growth was primarily due to increased sales of self-developed power semiconductors, laminated busbars, and DC-link capacitors, as well as higher revenue from new energy power station construction-related businesses[38](index=38&type=chunk) [Overseas Market Performance](index=16&type=section&id=Overseas%20Market%20Performance) Overseas market revenue increased by 9%, mainly due to higher sales of laminated busbars, DC-link capacitors, and solid-state DC circuit breakers Overseas Market Performance | Item | 2025 Revenue (RMB thousand) | 2024 Revenue (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Domestic subsidiary products | 4,916 | 2,595 | 89% | | Overseas subsidiary products | 37,436 | 36,116 | 4% | | Total | 42,352 | 38,711 | 9% | - Overseas market revenue growth was primarily due to increased sales of laminated busbars, DC-link capacitors, and solid-state DC circuit breakers[40](index=40&type=chunk) [Financial Review](index=16&type=section&id=Financial%20Review) [Revenue](index=16&type=section&id=Revenue) The Group's revenue increased by 35.5% year-on-year to RMB888.3 million, driven by product deliveries for major transmission projects and increased revenue from self-produced IGBTs - Revenue increased by **35.5%** to **RMB888.3 million**[41](index=41&type=chunk) - This was primarily due to the progressive delivery of products for the Saudi Central-South Project, Gan-Dian-Ru-Zhe Project, and Peru/Chile Distributed Power Flow Controller Project, as well as increased revenue from self-produced Insulated Gate Bipolar Transistors (IGBTs)[41](index=41&type=chunk) [Cost of Sales](index=16&type=section&id=Cost%20of%20Sales) Cost of sales increased by 56.6% year-on-year to RMB659.1 million, primarily in line with revenue growth - Cost of sales increased by **56.6%** to **RMB659.1 million**, primarily due to increased revenue[42](index=42&type=chunk) [Gross Profit and Gross Margin](index=16&type=section&id=Gross%20Profit%20and%20Gross%20Margin) Gross profit decreased by 2.3% year-on-year to RMB229.3 million, with gross margin declining from 35.8% to 25.8%, mainly due to a reduced proportion of high-margin products - Gross profit decreased by **2.3%** to **RMB229.3 million**[43](index=43&type=chunk) - Gross margin decreased from **35.8% to 25.8%**, primarily due to a reduced proportion of high-margin products[43](index=43&type=chunk) [Other Income and Gains](index=17&type=section&id=Other%20Income%20and%20Gains) Other income and gains significantly increased by 281.0% to RMB130.7 million, primarily driven by forward foreign exchange contracts and exchange gains - Other income and gains significantly increased by **281.0%** to **RMB130.7 million**, primarily due to forward foreign exchange contracts and exchange gains[44](index=44&type=chunk) [Selling and Distribution Costs](index=17&type=section&id=Selling%20and%20Distribution%20Costs) Selling and distribution costs increased by 27.1% year-on-year to RMB60.9 million, mainly due to higher market development expenses and an increase in sales personnel - Selling and distribution costs increased by **27.1%** to **RMB60.9 million**, primarily due to increased market development expenses and a rise in the number of sales personnel[45](index=45&type=chunk) [Administrative Expenses](index=17&type=section&id=Administrative%20Expenses) Administrative expenses increased by 26.8% year-on-year to RMB106.1 million, mainly due to business development and an increase in management personnel - Administrative expenses increased by **26.8%** to **RMB106.1 million**, primarily due to business development and an increase in the number of management personnel[46](index=46&type=chunk) [Research and Development Costs](index=17&type=section&id=Research%20and%20Development%20Costs) Research and development costs remained relatively stable, with a marginal increase of 0.1% to RMB67.9 million - Research and development costs marginally increased by **0.1%** to **RMB67.9 million**[47](index=47&type=chunk) [Other Expenses and Losses](index=17&type=section&id=Other%20Expenses%20and%20Losses) Other expenses and losses significantly decreased by 85.9% to RMB3.5 million, primarily due to exchange rate fluctuations - Other expenses and losses decreased by **85.9%** to **RMB3.5 million**, primarily due to exchange rate fluctuations[48](index=48&type=chunk) [Finance Costs](index=17&type=section&id=Finance%20Costs) Finance costs marginally increased by 3.5% year-on-year to RMB8.8 million - Finance costs increased by **3.5%** to **RMB8.8 million**[49](index=49&type=chunk) [Profit Before Tax](index=17&type=section&id=Profit%20Before%20Tax) Profit before tax significantly increased from RMB36.3 million to RMB112.8 million - Profit before tax increased from **RMB36.3 million** to **RMB112.8 million**[50](index=50&type=chunk) [Income Tax Expense](index=18&type=section&id=Income%20Tax%20Expense) Income tax expense increased by 77.3% year-on-year to RMB27.3 million, primarily due to increased revenue - Income tax expense increased by **77.3%** to **RMB27.3 million**, primarily due to increased revenue[51](index=51&type=chunk) [Profit and Total Comprehensive Income Attributable to Owners of the Parent](index=18&type=section&id=Profit%20and%20Total%20Comprehensive%20Income%20Attributable%20to%20Owners%20of%20the%20Parent) Net profit margin improved from 5.1% to 10.6%, with profit attributable to owners of the parent surging by 178.3% to RMB93.8 million, and total comprehensive income increasing by 150.0% to RMB82.5 million - Net profit margin increased from approximately **5.1%** to approximately **10.6%**[52](index=52&type=chunk) - Profit attributable to owners of the parent significantly increased by **178.3%** to **RMB93.8 million**[52](index=52&type=chunk) - Total comprehensive income attributable to owners of the parent increased by **150.0%** to **RMB82.5 million**[52](index=52&type=chunk) [Inventories](index=18&type=section&id=Inventories) Inventories decreased by 12.4% to RMB253.9 million, and the average inventory turnover days reduced from 94 to 82, indicating improved inventory management efficiency - Inventories decreased by **12.4%** to **RMB253.9 million**[53](index=53&type=chunk) - Average inventory turnover days decreased from approximately **94 days** to approximately **82 days**[53](index=53&type=chunk) [Trade and Bills Receivables](index=18&type=section&id=Trade%20and%20Bills%20Receivables) Trade and bills receivables slightly decreased by 1.2% to RMB1,147.1 million, with average turnover days reducing from 233 to 204, indicating improved collection efficiency - Trade and bills receivables decreased by **1.2%** to **RMB1,147.1 million**[54](index=54&type=chunk) - Average turnover days decreased from approximately **233 days** to approximately **204 days**[54](index=54&type=chunk) [Trade and Bills Payables](index=18&type=section&id=Trade%20and%20Bills%20Payables) Trade and bills payables increased by 4.2% to RMB434.0 million, primarily due to increased inventories, while average turnover days slightly decreased - Trade and bills payables increased by **4.2%** to **RMB434.0 million**, primarily due to increased inventories[55](index=55&type=chunk) - Average turnover days decreased from approximately **120 days** to approximately **116 days**[55](index=55&type=chunk) [Liquidity and Financial Resources](index=19&type=section&id=Liquidity%20and%20Financial%20Resources) The Group's current ratio remained stable at around 2.2, with increased cash and cash equivalents, reduced interest-bearing bank and other borrowings, and a capital gearing ratio decreasing to 13.9%, indicating a sound financial position - The current ratio remained stable at approximately **2.2**[56](index=56&type=chunk) - Cash and cash equivalents increased by **9.4%** to **RMB454.7 million**[56](index=56&type=chunk) - Interest-bearing bank and other borrowings decreased by **4.7%** to **RMB285.3 million**[56](index=56&type=chunk) - The capital gearing ratio decreased from approximately **15.0%** to approximately **13.9%**[56](index=56&type=chunk) [Foreign Currency Risk](index=19&type=section&id=Foreign%20Currency%20Risk) The Group faces transactional currency risk and mitigates exchange rate risk by entering into forward currency contracts with reputable banks - The Group faces transactional currency risk and has entered into forward currency contracts with reputable banks to hedge exchange rate risk[58](index=58&type=chunk) [Contingent Liabilities](index=19&type=section&id=Contingent%20Liabilities) As of June 30, 2025, the Group had no significant contingent liabilities - The Group had no significant contingent liabilities as of June 30, 2025[59](index=59&type=chunk) [Pledge of Group's Assets](index=19&type=section&id=Pledge%20of%20Group%27s%20Assets) Certain of the Group's bills payables are secured by bills receivables, while bank loans are secured by land use rights and buildings, plant, and machinery - Certain bills payables are secured by bills receivables of approximately **RMB50.1 million**[60](index=60&type=chunk) - Bank loans of **RMB78.7 million** are secured by land use rights with a net book value of approximately **RMB15.8 million** and buildings, plant, and machinery of **RMB324.1 million**[61](index=61&type=chunk) [Other Information](index=20&type=section&id=Other%20Information) [Events After the Reporting Period](index=20&type=section&id=Events%20After%20the%20Reporting%20Period) Subsequent to the reporting period, Saijing Semiconductor signed capital increase and equity transfer agreements with investors, involving the issuance of new registered capital to acquire Hunan Hongan's entire equity, which will dilute the Company's equity interest in Saijing Semiconductor - Saijing Semiconductor will issue new registered capital of **RMB180,000,000** to investors, representing approximately **9.00%** of the enlarged equity[62](index=62&type=chunk) - Investors will settle the subscription price by transferring their entire equity interest in Hunan Hongan to Saijing Semiconductor[62](index=62&type=chunk) - Upon completion of the transaction, the Company's equity interest in Saijing Semiconductor will decrease from approximately **70.5406%** to approximately **64.1918%**[62](index=62&type=chunk) [Human Resources](index=20&type=section&id=Human%20Resources) As of June 30, 2025, the Group had 1,066 employees, with a diverse compensation package, a focus on internal management training and development, and good working relationships with employees - The Group had a total of **1,066 employees**[64](index=64&type=chunk) - The compensation package includes basic salaries, medical insurance, discretionary cash bonuses, retirement benefit schemes, and share options[64](index=64&type=chunk) - The Group emphasizes establishing internal management training and development systems and maintains good working relationships with its employees[64](index=64&type=chunk) [Business Outlook](index=21&type=section&id=Business%20Outlook) In the second half of 2025, the Group will continue to deliver existing transmission project orders, strive for new UHV DC project orders, and intensify R&D and market expansion for self-developed power semiconductor products, especially in emerging fields like electrified vessels and controllable nuclear fusion - In the second half of 2025, the Group will continue to advance product deliveries for multiple conventional DC and flexible transmission projects, including the Shaan-Anhui Project, Saudi Central-South Project, and Gan-Dian-Ru-Zhe Project[65](index=65&type=chunk) - The Group aims to secure new orders in tenders for the Southeast Tibet Project, Inner Mongolia West to Beijing-Tianjin-Hebei Project, and other newly approved UHV DC projects[65](index=65&type=chunk) - The Group will continue to intensify technological R&D and market expansion for self-developed power semiconductor products, focusing on promoting cutting-edge technologies such as solid-state switches and pulsed power switches in emerging fields like electrified vessels and controllable nuclear fusion[65](index=65&type=chunk) [Purchase, Sale or Redemption of Listed Securities](index=21&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20Listed%20Securities) The Company repurchased 1,296,000 shares for approximately HK$1,524,145 during the six months ended June 30, 2025, to enhance market price per share and investor confidence, holding repurchased shares as treasury shares with no sales during the period - The Company repurchased a total of **1,296,000 shares** for approximately **HK$1,524,145** during the six months ended June 30, 2025[66](index=66&type=chunk) - The repurchased shares are held as treasury shares, with no treasury shares sold during the period[66](index=66&type=chunk) - The repurchases aim to enhance the market price per share and improve investor confidence in the Company[67](index=67&type=chunk) [Corporate Governance](index=22&type=section&id=Corporate%20Governance) The Company highly values corporate governance practices, has adopted the Corporate Governance Code in Appendix C1 of the Listing Rules, and complied with all applicable code provisions during the period - The Company has adopted the Corporate Governance Code set out in Appendix C1 to the Listing Rules[68](index=68&type=chunk) - For the six months ended June 30, 2025, the Company complied with the applicable code provisions set out in Part 2 of the Corporate Governance Code[68](index=68&type=chunk) [Standard Code for Securities Transactions by Directors](index=22&type=section&id=Standard%20Code%20for%20Securities%20Transactions%20by%20Directors) The Company has adopted the Standard Code for Securities Transactions by Directors of Listed Issuers as its code of conduct for directors' securities transactions and confirms compliance by directors during the period - The Company has adopted the Standard Code for Securities Transactions by Directors of Listed Issuers set out in Appendix C3 to the Listing Rules[69](index=69&type=chunk) - Following enquiry, the Company confirmed that the directors have complied with the required standards set out in the Standard Code throughout the period[69](index=69&type=chunk) [Review of Financial Statements by Audit Committee](index=22&type=section&id=Review%20of%20Financial%20Statements%20by%20Audit%20Committee) The Board's Audit Committee has reviewed the Group's accounting principles, risk management, internal controls, and financial reporting matters, including the condensed consolidated interim financial statements for the six months ended June 30, 2025 - The Audit Committee has reviewed the Group's accounting principles, risk management, internal controls, and financial reporting matters, including the condensed consolidated interim financial statements[70](index=70&type=chunk) [Declaration of Dividend and Closure of Register of Members](index=22&type=section&id=Declaration%20of%20Dividend%20and%20Closure%20of%20Register%20of%20Members) The Board resolved to declare an interim dividend of HK$0.01 per share and will suspend share transfer registration from October 6 to October 8, 2025, to determine shareholders entitled to the dividend - The Board resolved to declare an interim dividend of **HK$0.01 per share**, expected to be paid on or about October 22, 2025[71](index=71&type=chunk) - To determine shareholders entitled to the interim dividend, the register of members will be closed from **October 6 to October 8, 2025**[72](index=72&type=chunk) [Publication of Interim Results Announcement and Interim Report](index=23&type=section&id=Publication%20of%20Interim%20Results%20Announcement%20and%20Interim%20Report) This announcement has been published on the HKEX and Company websites, and the 2025 interim report will be published on both websites and sent to shareholders upon request - This announcement has been published on the HKEX website (www.hkexnews.hk) and the Company's website (www.sunking-tech.com)[73](index=73&type=chunk) - The Company's 2025 interim report will be published on both websites in due course and sent to shareholders upon request[73](index=73&type=chunk) [Webcast](index=23&type=section&id=Webcast) The Company will host an earnings webcast on August 25, 2025, to discuss the interim results for the six months ended June 30, 2025 - The Company will host an earnings webcast on **Monday, August 25, 2025, from 10:00 AM to 11:00 AM (Hong Kong time)**[74](index=74&type=chunk) - The webcast will be conducted via Tencent Meeting, with meeting ID **710-461-155**[75](index=75&type=chunk) [Board of Directors](index=23&type=section&id=Board%20of%20Directors) As of the date of this announcement, the Board of Directors comprises three executive directors and four independent non-executive directors - The executive directors are Mr Xiang Jie, Mr Gong Renyuan, and Mr Yue Zhoumin[76](index=76&type=chunk) - The independent non-executive directors are Mr Chen Shimin, Mr Zhang Xuejun, Mr Liang Mingxu, and Ms Cai Ge[76](index=76&type=chunk)

[Financial Highlights](index=1&type=section&id=%E8%B2%A1%E5%8B%99%E6%91%98%E8%A6%81) [Interim Performance Overview](index=1&type=section&id=%E4%B8%AD%E6%9C%9F%E6%A5%AD%E7%B8%BE) For the six months ended June 30, 2025, the Group achieved significant revenue growth, but gross profit and gross margin declined, while profit attributable to owners of the parent and earnings per share both increased | Indicator | Six Months Ended June 30, 2025 (RMB million) | Same Period in 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 888.3 | 655.8 | +35.5% | | Gross Profit | 229.3 | 234.8 | -2.3% | | Gross Margin | 25.8% | 35.8% | -10.0pp | | Profit Attributable to Owners of the Parent | 93.8 | 33.7 | +178.3% | | Earnings Per Share (Basic) | RMB 5.85 cents | RMB 2.09 cents | +179.9% | | Earnings Per Share (Diluted) | RMB 5.85 cents | RMB 2.09 cents | +179.9% | [Interim Condensed Consolidated Financial Statements](index=2&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8) [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=2&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%90%8D%E7%9B%8A%E5%8F%8A%E5%85%B6%E4%BB%96%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) For the six months ended June 30, 2025, the Group's revenue increased by 35.5% year-on-year, profit for the period significantly grew to RMB 85.47 million, and profit attributable to owners of the parent was RMB 93.773 million | Indicator | June 30, 2025 (RMB thousand) | June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue | 888,320 | 655,758 | | Gross Profit | 229,254 | 234,784 | | Other Income and Gains | 130,747 | 34,335 | | Profit Before Tax | 112,808 | 36,349 | | Profit for the Period | 85,470 | 20,933 | | Profit Attributable to Owners of the Parent | 93,773 | 33,722 | | Basic Earnings Per Share | RMB 5.85 cents | RMB 2.09 cents | [Condensed Consolidated Statement of Financial Position](index=4&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) As of June 30, 2025, the Group's total non-current and current assets both increased, with net assets reaching RMB 2,057.99 million and equity attributable to owners of the parent at RMB 1,997.983 million | Indicator | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Total Non-current Assets | 1,030,009 | 1,012,660 | | Total Current Assets | 2,040,579 | 2,022,187 | | Total Current Liabilities | 920,425 | 935,050 | | Net Assets | 2,057,990 | 1,995,956 | | Equity Attributable to Owners of the Parent | 1,997,983 | 1,924,376 | [Notes to the Interim Condensed Consolidated Financial Statements](index=6&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8%E9%99%84%E8%A8%BB) [Company Information](index=6&type=section&id=1.%20%E5%85%AC%E5%8F%B8%E8%B3%87%E6%96%99) Sunking Technology Group Limited is incorporated in the Cayman Islands, with ordinary shares listed on the Hong Kong Stock Exchange, primarily engaged in trading and manufacturing power electronic components, with financial information presented in RMB - The Company was incorporated in the Cayman Islands on March 19, 2010, and listed on the Main Board of the Hong Kong Stock Exchange on October 13, 2010[9](index=9&type=chunk) - The Group's principal activities are the trading and manufacturing of power electronic components[10](index=10&type=chunk) - The interim condensed consolidated financial information is presented in RMB[11](index=11&type=chunk) [Changes in Accounting Policies](index=6&type=section&id=2.%20%E6%9C%83%E8%A8%88%E6%94%BF%E7%AD%96%E7%9A%84%E8%AE%8A%E5%8B%95) The Group first adopted the revised IAS 21 (Lack of Exchangeability) in the current period, but it had no impact on the interim condensed consolidated financial information as the Group's transaction and functional currencies are exchangeable - The Group first adopted the revised International Accounting Standard 21 "Lack of Exchangeability" in the current period[12](index=12&type=chunk)[13](index=13&type=chunk) - This revision had no impact on the interim condensed consolidated financial information as the Group's transaction and functional currencies are exchangeable[13](index=13&type=chunk) [Operating Segment Information](index=6&type=section&id=3.%20%E7%B6%93%E7%87%9F%E5%88%86%E9%83%A8%E8%B3%87%E6%96%99) The Group operates a single reportable operating segment, which is the manufacturing and trading of power electronic components, with over 95% of revenue and all non-current assets attributable to mainland China, thus no other geographical segment information is provided - The Group operates a single reportable operating segment, primarily engaged in the manufacturing and trading of power electronic components[14](index=14&type=chunk) - Over **95%** of the Group's revenue (December 31, 2024: over 94%) is attributable to customers in mainland China, and all non-current assets are located in mainland China[15](index=15&type=chunk) [Revenue, Other Income and Gains](index=7&type=section&id=4.%20%E6%94%B6%E5%85%A5%E3%80%81%E5%85%B6%E4%BB%96%E6%94%B6%E5%85%A5%E5%8F%8A%E6%94%B6%E7%9B%8A) Revenue from contracts with customers primarily from sales of power electronic components increased by 35.5% year-on-year, while other income and gains significantly increased by 281.0%, mainly due to government grants, bank interest income, and net fair value gains on forward foreign exchange contracts and exchange gains | Item | June 30, 2025 (RMB thousand) | June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue from Contracts with Customers (Sales of Power Electronic Components) | 888,320 | 655,758 | | Total Other Income and Gains | 130,747 | 34,335 | | Of which: Government Grants | 33,270 | 20,348 | | Net Exchange Gains | 31,342 | – | | Net Fair Value Gains on Forward Foreign Exchange Contracts | 59,939 | – | - Other income and gains significantly increased by approximately **281.0%**, primarily due to net fair value gains on forward foreign exchange contracts and exchange gains[16](index=16&type=chunk)[44](index=44&type=chunk) [Profit Before Tax](index=8&type=section&id=5.%20%E9%99%A4%E7%A8%85%E5%89%8D%E6%BA%A2%E5%88%A9) The Group's profit before tax significantly increased, positively impacted by higher other income and gains and reduced exchange losses, while cost of sales, depreciation, amortization, and impairment expenses also increased | Item | June 30, 2025 (RMB thousand) | June 30, 2

[Report Statement and GEM Characteristics](index=1&type=section&id=Report%20Statement%20and%20GEM%20Characteristics) [GEM Characteristics](index=1&type=section&id=GEM%20Characteristics) This announcement presents KOS International Holdings Limited's interim results for the six months ended June 30, 2025, highlighting GEM as a listing platform for SMEs with higher investment risks requiring investor caution - The GEM market is positioned as a listing platform for small and medium-sized companies, but it carries higher investment risks[1](index=1&type=chunk) [Disclaimer](index=1&type=section&id=Disclaimer) Hong Kong Exchanges and Clearing Limited and the Stock Exchange are not responsible for this announcement's content and accept no liability for any loss - HKEX and the Stock Exchange are not responsible for the announcement's content and bear no liability for any loss[2](index=2&type=chunk) - The company's directors confirm the accuracy and completeness of the announcement's information, its freedom from misleading or fraudulent content, and accept full responsibility[3](index=3&type=chunk) [Financial Performance Overview](index=2&type=section&id=Financial%20Performance%20Overview) [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=2&type=section&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the six months ended June 30, 2025, the company achieved HKD 136,290 thousand in revenue, a 46.5% increase, and turned a loss into a profit of HKD 2,326 thousand, with basic earnings per share of HKD 0.29 cents Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the six months ended June 30) | Indicator | 2025 (HKD Thousand) | 2024 (HKD Thousand) | Change (HKD Thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenue | 136,290 | 93,037 | 43,253 | 46.5% | | Other income | 873 | 623 | 250 | 40.1% | | Staff costs | (121,271) | (80,511) | (40,760) | 50.6% | | Other expenses and losses | (12,435) | (15,579) | 3,144 | -20.2% | | Finance costs | (418) | (96) | (322) | 335.4% | | Profit (Loss) before tax | 3,295 | (2,555) | 5,850 | N/A | | Income tax (expense) credit | (969) | 89 | (1,058) | N/A | | Profit (Loss) for the period | 2,326 | (2,466) | 4,792 | N/A | | Basic and diluted earnings (loss) per share (HK Cents) | 0.29 | (0.31) | 0.60 | N/A | [Condensed Consolidated Statement of Financial Position](index=3&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the company's net assets increased to HKD 60,754 thousand, a 4.45% rise from December 31, 2024, with net current assets remaining robust at HKD 52,577 thousand despite a slight decrease in the current ratio Condensed Consolidated Statement of Financial Position (As of June 30) | Indicator | 2025 (HKD Thousand) | 2024 (HKD Thousand) | Change (HKD Thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Non-current assets | 13,234 | 15,148 | (1,914) | -12.6% | | Current assets | 76,923 | 68,554 | 8,369 | 12.2% | | Current liabilities | 24,346 | 18,836 | 5,510 | 29.3% | | Net current assets | 52,577 | 49,718 | 2,859 | 5.8% | | Non-current liabilities | 5,057 | 6,703 | (1,646) | -24.6% | | Net assets | 60,754 | 58,163 | 2,591 | 4.45% | [Condensed Consolidated Statement of Changes in Equity](index=5&type=section&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) For the six months ended June 30, 2025, the company's total equity increased from HKD 58,163 thousand to HKD 60,754 thousand, primarily driven by a profit for the period of HKD 2,326 thousand and other comprehensive income of HKD 265 thousand Condensed Consolidated Statement of Changes in Equity (For the six months ended June 30) | Indicator | 2025 (HKD Thousand) | 2024 (HKD Thousand) | | :--- | :--- | :--- | | Total equity at beginning of period | 58,163 | 61,229 | | Profit (Loss) for the period | 2,326 | (2,466) | | Other comprehensive income (expense) for the period | 265 | (227) | | Total equity at end of period | 60,754 | 58,536 | [Condensed Consolidated Statement of Cash Flows](index=6&type=section&id=Unaudited%20Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) For the six months ended June 30, 2025, net cash outflow from operating activities was HKD 8,186 thousand, net cash outflow from investing activities was HKD 162 thousand, and net cash inflow from financing activities was HKD 5,413 thousand, resulting in a net decrease of HKD 2,935 thousand in cash and cash equivalents Condensed Consolidated Statement of Cash Flows (For the six months ended June 30) | Indicator | 2025 (HKD Thousand) | 2024 (HKD Thousand) | | :--- | :--- | :--- | | Net cash used in operating activities | (8,186) | (7,994) | | Net cash from (used in) investing activities | (162) | 109 | | Net cash from (used in) financing activities | 5,413 | (3,217) | | Net decrease in cash and cash equivalents | (2,935) | (11,102) | | Cash and cash equivalents at end of period | 21,893 | 23,421 | [Notes to the Financial Statements](index=7&type=section&id=Notes%20to%20the%20Financial%20Statements) [1. General Information](index=7&type=section&id=1.%20General%20Information) KOS International Holdings Limited, incorporated in the Cayman Islands and listed on GEM since October 12, 2018, primarily provides recruitment, secondment, and payroll services across Hong Kong, Macau, Mainland China, and Singapore - The company was incorporated in the Cayman Islands and listed on GEM of the Stock Exchange on **October 12, 2018**[10](index=10&type=chunk) - Principal activities include providing recruitment and/or secondment and payroll services in Hong Kong, Macau, Mainland China, and Singapore[11](index=11&type=chunk) [2. Basis of Preparation and Principal Accounting Policies](index=7&type=section&id=2.%20Basis%20of%20Preparation%20and%20Principal%20Accounting%20Policies) The condensed consolidated financial statements are prepared on a historical cost basis, adhering to HKAS 34 and GEM Listing Rules Chapter 18, with consistent accounting policies from the prior year and no significant impact from new or revised standards - Financial statements are prepared on a historical cost basis and in accordance with HKAS 34 and GEM Listing Rule Chapter 18[14](index=14&type=chunk) - Adopted accounting policies are consistent with the previous year, with no significant impact from new or revised standards[14](index=14&type=chunk) [3. Revenue Classification and Segment Information](index=8&type=section&id=3.%20Revenue%20Classification%20and%20Segment%20Information) For the six months ended June 30, 2025, total revenue was HKD 136,290 thousand, with secondment and payroll services revenue significantly increasing by 76.5% to HKD 99,332 thousand, while recruitment services revenue slightly increased by 0.5% to HKD 36,958 thousand, and Hong Kong operations contributed 91.3% of total revenue Revenue Classification (For the six months ended June 30) | Service Type | Region | 2025 (HKD Thousand) | 2024 (HKD Thousand) | Change (HKD Thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Recruitment Services | Hong Kong | 27,646 | 26,352 | 1,294 | 4.9% | | | Mainland China | 8,021 | 8,457 | (436) | -5.2% | | | Singapore | 1,291 | 1,954 | (663) | -33.9% | | **Total Recruitment Services** | | **36,958** | **36,763** | **195** | **0.5%** | | Secondment and Payroll Services | Hong Kong | 96,840 | 54,803 | 42,037 | 76.7% | | | Macau | 1,882 | 1,471 | 411 | 27.9% | | | Mainland China | 610 | – | 610 | N/A | | **Total Secondment and Payroll Services** | | **99,332** | **56,274** | **43,058** | **76.5%** | | **Total** | | **136,290** | **93,037** | **43,253** | **46.5%** | - Hong Kong operations contributed **91.3%** of the Group's total revenue (2024: 87.2%)[18](index=18&type=chunk) Revenue from Major Customers (For the six months ended June 30) | Customer | 2025 (HKD Thousand) | 2024 (HKD Thousand) | | :--- | :--- | :--- | | Customer A | 19,234 | 10,837 | | Customer B | 16,749 | – | [4. Finance Costs](index=9&type=section&id=4.%20Finance%20Costs) For the six months ended June 30, 2025, finance costs significantly increased to HKD 418 thousand, a 335.4% rise from HKD 96 thousand in the prior period, primarily due to interest on lease liabilities and new bank borrowings Finance Costs (For the six months ended June 30) | Item | 2025 (HKD Thousand) | 2024 (HKD Thousand) | Change (HKD Thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Interest on lease liabilities | 289 | 85 | 204 | 240.0% | | Interest on bank borrowings | 114 | – | 114 | N/A | | Interest on provision for reinstatement costs | 15 | 11 | 4 | 36.4% | | **Total** | **418** | **96** | **322** | **335.4%** | [5. Income Tax Expense (Credit)](index=9&type=section&id=5.%20Income%20Tax%20Expense%20(Credit)) For the six months ended June 30, 2025, income tax expense was HKD 969 thousand, compared to a credit of HKD 89 thousand in the prior period, mainly due to increased taxable profit and an over-provision credit last year, with Hong Kong profits tax at 16.5% and 8.25% for the first HKD 2 million of profit for qualifying entities Income Tax Expense (Credit) (For the six months ended June 30) | Item | 2025 (HKD Thousand) | 2024 (HKD Thousand) | Change (HKD Thousand) | | :--- | :--- | :--- | :--- | | Hong Kong profits tax | 969 | 360 | 609 | | Singapore corporate income tax | – | 17 | (17) | | Over-provision in prior years | – | (466) | 466 | | **Total** | **969** | **(89)** | **1,058** | - Hong Kong profits tax is calculated at **16.5%**, with the first **HKD 2 million** of profit for qualifying entities taxed at **8.25%**[21](index=21&type=chunk)[22](index=22&type=chunk) - Macau and Mainland China subsidiaries made no income tax provision due to no taxable profit or qualifying for small and micro-enterprise preferential policies[22](index=22&type=chunk)[23](index=23&type=chunk)[24](index=24&type=chunk) [6. Earnings (Loss) Per Share](index=10&type=section&id=6.%20Earnings%20(Loss)%20Per%20Share) For the six months ended June 30, 2025, basic earnings per share were HKD 0.29 cents, compared to a loss per share of HKD 0.31 cents in the prior period, primarily due to the profit for the period turning positive, with no diluted earnings presented as no potential ordinary shares were outstanding Earnings (Loss) Per Share (For the six months ended June 30) | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Profit (Loss) for the period (HKD Thousand) | 2,326 | (2,466) | | Weighted average number of ordinary shares (Thousand Shares) | 800,000 | 800,000 | | Basic earnings (loss) per share (HK Cents) | 0.29 | (0.31) | - No potential ordinary shares were outstanding during the current or prior period, thus no diluted earnings (loss) per share is presented[25](index=25&type=chunk) [7. Dividends](index=10&type=section&id=7.%20Dividends) The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025, consistent with the prior period - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025 (2024: nil)[26](index=26&type=chunk) [8. Movements in Property, Plant and Equipment and Right-of-Use Assets](index=10&type=section&id=8.%20Movements%20in%20Property%2C%20Plant%20and%20Equipment%20and%20Right-of-Use%20Assets) For the six months ended June 30, 2025, the Group purchased approximately HKD 169 thousand in property, plant and equipment, and entered into new lease agreements for office properties in Singapore and Shanghai, recognizing corresponding right-of-use assets and lease liabilities - For the six months ended June 30, 2025, the Group purchased property, plant and equipment with a total cost of approximately **HKD 169 thousand**[27](index=27&type=chunk) - A new lease agreement for the Singapore office was entered into, recognizing approximately **HKD 741 thousand** in right-of-use assets and **HKD 733 thousand** in lease liabilities[28](index=28&type=chunk) - A new lease agreement for the Shanghai office was entered into, recognizing approximately **HKD 465 thousand** in right-of-use assets and **HKD 463 thousand** in lease liabilities[28](index=28&type=chunk) [9. Trade and Other Receivables](index=11&type=section&id=9.%20Trade%20and%20Other%20Receivables) As of June 30, 2025, total trade and other receivables amounted to HKD 53,583 thousand, an increase of 28.1% from December 31, 2024, with the largest portion of trade receivables, HKD 36,884 thousand, due within 30 days Trade and Other Receivables (As of June 30) | Item | 2025 (HKD Thousand) | 2024 (HKD Thousand) | Change (HKD Thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Trade receivables | 50,637 | 40,116 | 10,521 | 26.2% | | Less: Provision for expected credit losses | (1,086) | (1,284) | 198 | -15.4% | | Other receivables | 4,032 | 3,099 | 933 | 30.1% | | **Total trade and other receivables** | **53,583** | **41,831** | **11,752** | **28.1%** | - The Group grants credit terms of up to **60 days** to its customers[29](index=29&type=chunk) Aging Analysis of Trade Receivables (As of June 30) | Aging | 2025 (HKD Thousand) | 2024 (HKD Thousand) | | :--- | :--- | :--- | | Within 30 days | 36,884 | 29,589 | | 31 to 60 days | 8,525 | 4,316 | | 61 to 90 days | 1,867 | 1,574 | | 91 to 180 days | 2,275 | 2,914 | | Over 180 days | – | 439 | | **Total** | **49,551** | **38,832** | [10. Financial Assets at Fair Value Through Profit or Loss](index=12&type=section&id=10.%20Financial%20Assets%20at%20Fair%20Value%20Through%20Profit%20or%20Loss) As of June 30, 2025, financial assets at fair value through profit or loss increased to HKD 465 thousand from HKD 419 thousand as of December 31, 2024, primarily comprising listed securities Financial Assets at Fair Value Through Profit or Loss (As of June 30) | Item | 2025 (HKD Thousand) | 2024 (HKD Thousand) | | :--- | :--- | :--- | | Listed securities | 465 | 419 | - The fair value of listed securities is based on bid prices quoted in active markets in Hong Kong[33](index=33&type=chunk) [11. Other Payables and Accruals and Contract Liabilities](index=12&type=section&id=11.%20Other%20Payables%20and%20Accruals%20and%20Contract%20Liabilities) As of June 30, 2025, total other payables and accruals decreased by 20.5% to HKD 11,481 thousand from December 31, 2024, while contract liabilities remained stable at HKD 193 thousand Other Payables and Accruals (As of June 30) | Item | 2025 (HKD Thousand) | 2024 (HKD Thousand) | Change (HKD Thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Other payables | 1,795 | 2,467 | (672) | -27.2% | | Accrued expenses | 669 | 1,117 | (448) | -40.1% | | Accrued payroll expenses | 9,017 | 10,862 | (1,845) | -17.0% | | **Total** | **11,481** | **14,446** | **(2,965)** | **-20.5%** | Contract Liabilities (As of June 30) | Item | 2025 (HKD Thousand) | 2024 (HKD Thousand) | | :--- | :--- | :--- | | Secondment and payroll services | 193 | 193 | [12. Bank Borrowings](index=12&type=section&id=12.%20Bank%20Borrowings) As of June 30, 2025, the Group incurred new secured bank borrowings of HKD 8,000 thousand, bearing interest at HIBOR or cost of funds plus 1.7% to 3%, with an effective annual interest rate of 6.1% Bank Borrowings (As of June 30) | Item | 2025 (HKD Thousand) | 2024 (HKD Thousand) | | :--- | :--- | :--- | | Bank borrowings, secured | 8,000 | – | - Secured bank borrowings bear interest at HIBOR or cost of funds plus **1.7% to 3%** per annum, with an effective annual interest rate of **6.1%**[34](index=34&type=chunk) [13. Contingent Liabilities](index=12&type=section&id=13.%20Contingent%20Liabilities) As of June 30, 2025, the Group had no significant contingent liabilities, consistent with the situation as of December 31, 2024 - As of June 30, 2025, the Group had no significant contingent liabilities[35](index=35&type=chunk) [14. Fair Value Measurement of Financial Instruments](index=13&type=section&id=14.%20Fair%20Value%20Measurement%20of%20Financial%20Instruments) The Group measures certain financial instruments at fair value, including Level 1 listed equity securities at fair value through profit or loss and Level 3 unlisted equity investments at fair value through other comprehensive income, with the latter valued using the market approach Financial Assets Measured at Fair Value on a Recurring Basis (As of June 30) | Financial Assets | 2025 (HKD Thousand) | 2024 (HKD Thousand) | Fair Value Hierarchy | Valuation Technique and Key Inputs | | :--- | :--- | :--- | :--- | :--- | | Listed equity securities classified as equity instruments at fair value through profit or loss | 465 | 419 | Level 1 | Valued based on quotes available from the Stock Exchange | | Unlisted equity investments classified as equity instruments at fair value through other comprehensive income | 1,174 | 1,174 | Level 3 | Market approach, using comparable multiples of price-to-sales ratio and illiquidity discount | - For the six months ended June 30, 2025, and the year ended December 31, 2024, there were no transfers between Level 1 and Level 2, nor any transfers into or out of Level 3 fair value measurements[38](index=38&type=chunk) [15. Related Party Transactions](index=14&type=section&id=15.%20Related%20Party%20Transactions) For the six months ended June 30, 2025, total remuneration for key management personnel was HKD 3,336 thousand, a decrease from HKD 3,722 thousand in the prior period Remuneration of Key Management Personnel (For the six months ended June 30) | Item | 2025 (HKD Thousand) | 2024 (HKD Thousand) | Change (HKD Thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Short-term benefits | 3,300 | 3,686 | (386) | -10.5% | | Post-employment benefits | 36 | 36 | – | 0.0% | | **Total** | **3,336** | **3,722** | **(386)** | **-10.4%** | [Management Discussion and Analysis](index=15&type=section&id=Management%20Discussion%20and%20Analysis) [Business Review and Outlook](index=15&type=section&id=Business%20Review%20and%20Outlook) Despite challenging market conditions and an uncertain economic outlook in the first half of 2025, the Group successfully turned a loss into a profit with a significant 46.5% increase in total revenue, driven by a focus on payroll and secondment services, with future plans including expanding into the Greater Bay Area and Southeast Asian markets, enhancing operational efficiency, and talent development - The Group is a leading human resources service provider in Hong Kong, offering recruitment, secondment, and payroll services, with offices in Hong Kong, Macau, Shenzhen, Guangzhou, Shanghai, and Singapore[42](index=42&type=chunk) - In the first half of 2025, the Group successfully turned a loss into a profit, recording a net profit of approximately **HKD 2,326 thousand**, compared to a net loss of approximately **HKD 2,466 thousand** in the same period last year[43](index=43&type=chunk) - The Group's total revenue grew significantly, primarily driven by the strong performance of secondment and payroll services, while traditional recruitment services in Hong Kong faced pressure from weak market demand and increased competition[43](index=43&type=chunk)[44](index=44&type=chunk) - Future outlook includes: adhering to the Greater Bay Area development plan, increasing business in sectors like technology, consumer, and real estate; enhancing the quality of existing teams; and improving public awareness and brand recognition[55](index=55&type=chunk)[56](index=56&type=chunk) - The Group will focus resources on sectors with strong recovery potential, continuously recruit, train, and retain top recruitment talent, and enhance productivity and profitability through stringent team composition, geographical deployment, and performance monitoring[57](index=57&type=chunk)[59](index=59&type=chunk) [Business Review](index=15&type=section&id=Business%20Review) In the first half of 2025, despite market volatility and an uncertain economic outlook leading to a cautious recruitment environment, the Group achieved a significant 46.5% increase in total revenue and successfully turned a loss into a profit by focusing on secondment and payroll services - In the first half of 2025, the Group's total revenue significantly increased by approximately **HKD 43,253 thousand** or **46.5%** to **HKD 136,290 thousand**[47](index=47&type=chunk) - Hong Kong recruitment services revenue increased by **4.9%**, secondment and payroll services revenue significantly increased by **76.5%**, while Singapore recruitment services revenue decreased by **33.9%**[47](index=47&type=chunk) - The Group continuously invests in experienced recruitment personnel and industry expert teams, and implements measures to enhance operational efficiency, including streamlining internal processes, leveraging technology, and data-driven decision-making[45](index=45&type=chunk)[46](index=46&type=chunk) [Revenue from Hong Kong Operations](index=16&type=section&id=Revenue%20from%20Hong%20Kong%20Operations) Despite an unfavorable economic environment in Hong Kong affecting recruitment service demand, secondment and payroll services became a key growth driver, with revenue significantly increasing by 76.7%, reflecting the company's ability to adapt to changing client needs, while recruitment services revenue slightly increased by 4.9% but faced challenges from candidates' reluctance to change jobs and extended recruitment processes - Hong Kong secondment and payroll services revenue significantly increased by **HKD 42,037 thousand** or **76.7%** from **HKD 54,803 thousand** to **HKD 96,840 thousand**, primarily due to an increase in client numbers[50](index=50&type=chunk) - Hong Kong recruitment services revenue slightly increased by **HKD 1,294 thousand** or **4.9%** to **HKD 27,646 thousand**, but faced challenges from market caution, candidates' reluctance to change jobs, and extended recruitment timelines[49](index=49&type=chunk) - The Group supports clients in navigating economic uncertainties by offering value-added services such as talent mapping and workforce planning[49](index=49&type=chunk) [Revenue from Mainland China Operations](index=17&type=section&id=Revenue%20from%20Mainland%20China%20Operations) Mainland China operations faced complex challenges, with recruitment revenue decreasing by 5.2% to HKD 8,021 thousand; however, the Group, through its new Shanghai office and existing Shenzhen and Guangzhou offices, is committed to strengthening client relationships, enhancing service quality, and prioritizing talent development and quality operations, maintaining confidence in future growth potential - Mainland China recruitment revenue decreased by **HKD 436 thousand** or **5.2%** from **HKD 8,457 thousand** to **HKD 8,021 thousand**[52](index=52&type=chunk) - The Group established a new office in Shanghai and continues to provide services in Shenzhen and Guangzhou, committed to strengthening client relationships and enhancing service quality[51](index=51&type=chunk) - The Group is confident in the growth potential of its Mainland China operations, focusing on diversified development, client-centric solutions, and geographical expansion strategies[53](index=53&type=chunk) [Revenue from Singapore Operations](index=18&type=section&id=Revenue%20from%20Singapore%20Operations) Singapore recruitment business revenue decreased by 33.9% to HKD 1,291 thousand, but the Group remains committed to providing excellent recruitment services, leveraging expertise to identify top talent, and views this as part of its strategic expansion into Southeast Asia - Singapore recruitment business revenue decreased by **HKD 663 thousand** or **33.9%** from **HKD 1,954 thousand** to **HKD 1,291 thousand**[54](index=54&type=chunk) - Despite the revenue decline, Singapore operations demonstrated resilience, and the Group is committed to providing excellent recruitment services, viewing it as part of its strategic expansion into Southeast Asia[54](index=54&type=chunk) [Outlook](index=18&type=section&id=Outlook) The Group remains optimistic about the long-term growth prospects of the HR industry in Hong Kong, Mainland China, and Southeast Asia, focusing resources on sectors with strong recovery potential, continuously investing in talent development, and enhancing productivity and profitability through operational optimization, while exploring new market opportunities and potential investments - The Group will focus resources on sectors with strong recovery potential and continuously recruit, train, and retain top recruitment talent[57](index=57&type=chunk) - It will focus on enhancing productivity and profitability through stringent team composition, geographical deployment, and performance monitoring measures[57](index=57&type=chunk)[59](index=59&type=chunk) - The Group will continue to evaluate opportunities for geographical expansion and service diversification, and closely monitor potential investment opportunities that offer good returns and/or generate synergies with its core business[57](index=57&type=chunk)[59](index=59&type=chunk) [Financial Review](index=20&type=section&id=Financial%20Review) The Group's revenue for the first half of 2025 significantly increased by 46.5% to HKD 136,290 thousand, primarily driven by a strong 76.5% growth in secondment and payroll services, successfully turning a loss into a net profit of HKD 2,326 thousand, with staff costs increasing due to business expansion but other expenses decreasing, and the Group maintaining robust liquidity with a gearing ratio of 27.4% - The Group's revenue increased by **46.5%** from **HKD 93,037 thousand** to **HKD 136,290 thousand**, primarily due to increased revenue from secondment and payroll services[60](index=60&type=chunk) - Profit for the period and total comprehensive income amounted to **HKD 2,326 thousand**, successfully reversing the loss incurred in the same period last year[70](index=70&type=chunk) - As of June 30, 2025, the current ratio was approximately **3.2 times**, and the gearing ratio was **27.4%**, with directors believing the Group has sufficient liquidity[72](index=72&type=chunk)[73](index=73&type=chunk) [Revenue](index=20&type=section&id=Revenue) The Group's total revenue significantly increased by 46.5% to HKD 136,290 thousand, primarily driven by a 76.5% growth in secondment and payroll services revenue, while recruitment services revenue slightly increased by 0.5%, with Hong Kong recruitment services growing by 4.9%, but Mainland China and Singapore recruitment services decreasing by 5.2% and 33.9% respectively - Total revenue increased by **HKD 43,253 thousand** or **46.5%** from **HKD 93,037 thousand** to **HKD 136,290 thousand**[60](index=60&type=chunk) - Secondment and payroll services revenue significantly increased by **HKD 43,058 thousand** or **76.5%** to **HKD 99,332 thousand**, primarily due to the expansion of the Hong Kong secondment team and implementation of new strategies[63](index=63&type=chunk) - Recruitment services revenue slightly increased by **HKD 195 thousand** or **0.5%** to **HKD 36,958 thousand**, with Hong Kong recruitment services growing by **4.9%**, while Mainland China and Singapore recruitment services decreased by **5.2%** and **33.9%** respectively[61](index=61&type=chunk) [Other Income](index=21&type=section&id=Other%20Income) Other income increased by 40.1% to HKD 873 thousand, primarily due to increased revenue from visa application services and seminar and training services - Other income increased by **HKD 250 thousand** or **40.1%** from **HKD 623 thousand** to **HKD 873 thousand**[64](index=64&type=chunk) - The increase primarily stemmed from visa application services and seminar and training services, generating approximately **HKD 621 thousand** in revenue[64](index=64&type=chunk) [Staff Costs](index=21&type=section&id=Staff%20Costs) Staff costs significantly increased by 50.6% to HKD 121,271 thousand, primarily due to a substantial increase in seconded employees from 671 to 2,650, aligning with the growth in secondment and payroll services revenue, with seconded employee costs accounting for 74.0% of total staff costs - Staff costs increased by **HKD 40,760 thousand** or **50.6%** from **HKD 80,511 thousand** to **HKD 121,271 thousand**[65](index=65&type=chunk) - The increase in staff costs was primarily due to a significant rise in the number of seconded employees, from **671** as of June 30, 2024, to **2,650** as of June 30, 2025[65](index=65&type=chunk) - Seconded employee costs amounted to **HKD 89,696 thousand**, representing **74.0%** of total staff costs, while in-house staff costs were **HKD 31,575 thousand**, accounting for **26.0%**[66](index=66&type=chunk) [Other Expenses and Losses](index=21&type=section&id=Other%20Expenses%20and%20Losses) Other expenses and losses decreased by 20.2% to HKD 12,435 thousand, primarily including rent and rates, depreciation, marketing and advertising expenses, and insurance expenses - Other expenses and losses decreased by **HKD 3,144 thousand** or **20.2%** from **HKD 15,579 thousand** to **HKD 12,435 thousand**[67](index=67&type=chunk) [Finance Costs](index=22&type=section&id=Finance%20Costs) Finance costs significantly increased to HKD 418 thousand, primarily comprising interest on lease liabilities (HKD 289 thousand) and interest on new bank borrowings (HKD 114 thousand) - Finance costs primarily refer to interest on lease liabilities of **HKD 289 thousand** and interest on bank borrowings of **HKD 114 thousand**[68](index=68&type=chunk) [Income Tax (Expense) Credit](index=22&type=section&id=Income%20Tax%20(Expense)%20Credit) Income tax expense shifted from a credit of HKD 89 thousand in the prior period to an expense of HKD 969 thousand, an increase of HKD 1,058 thousand, primarily due to increased taxable profit from operating subsidiaries and an over-provision credit last year - Income tax expense increased by **HKD 1,058 thousand** from a credit of **HKD 89 thousand** for the six months ended June 30, 2024, to an expense of **HKD 969 thousand** for the six months ended June 30, 2025[69](index=69&type=chunk) - The increase was primarily due to higher estimated taxable profits from operating subsidiaries and the income tax credit from prior years in 2024[69](index=69&type=chunk) [Profit for the Period and Total Comprehensive Income (Expense)](index=22&type=section&id=Profit%20for%20the%20Period%20and%20Total%20Comprehensive%20Income%20(Expense)) The Group recorded a net profit of HKD 2,326 thousand and total comprehensive income of HKD 2,591 thousand for the period, successfully reversing the net loss of HKD 2,466 thousand and total comprehensive expense of HKD 2,693 thousand in the same period last year, primarily due to significant growth in secondment and payroll services revenue - The Group recorded a net profit of **HKD 2,326 thousand** and total comprehensive income of **HKD 2,591 thousand**, compared to a net loss of **HKD 2,466 thousand** and total comprehensive expense of **HKD 2,693 thousand** in the same period last year[70](index=70&type=chunk) - The net profit was primarily attributable to increased revenue from secondment and payroll services, benefiting from effective business development strategies and client expansion[70](index=70&type=chunk) [Dividends](index=22&type=section&id=Dividends) The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025, consistent with the prior period - The Directors do not recommend the payment of an interim dividend for the six months ended June 30, 2025 (2024: nil)[71](index=71&type=chunk) [Liquidity, Financial Resources and Gearing Ratio](index=23&type=section&id=Liquidity%2C%20Financial%20Resources%20and%20Gearing%20Ratio) As of June 30, 2025, the Group had HKD 2,400 thousand in pledged bank deposits and HKD 21,893 thousand in bank balances and cash, with a current ratio of 3.2 times and a gearing ratio of 27.4%, and directors deeming liquidity sufficient - As of June 30, 2025, the Group had pledged bank deposits of **HKD 2,400 thousand** and bank balances and cash of approximately **HKD 21,893 thousand**[72](index=72&type=chunk) - The current ratio was approximately **3.2 times** (December 31, 2024: approximately 3.6 times), and the gearing ratio was **27.4%** (December 31, 2024: 17.6%)[72](index=72&type=chunk)[73](index=73&type=chunk) - The Directors believe the Group has sufficient liquidity to meet its funding requirements[73](index=73&type=chunk) [Foreign Exchange Risk](index=23&type=section&id=Foreign%20Exchange%20Risk) Most of the Group's revenue-generating operations are denominated in Hong Kong Dollars, so foreign exchange rate fluctuation risk is not significant, and no hedging or other arrangements have been made - Most of the Group's revenue-generating operations are denominated in Hong Kong Dollars, thus foreign exchange rate fluctuation risk is not significant, and no hedging or other arrangements have been made[74](index=74&type=chunk) [Share Capital Structure](index=23&type=section&id=Share%20Capital%20Structure) For the six months ended June 30, 2025, there was no change in the company's share capital structure, with a total of 800,000,000 ordinary shares issued, each with a par value of HKD 0.01 - For the six months ended June 30, 2025, there was no change in the company's share capital structure[75](index=75&type=chunk) - The total number of ordinary shares issued was **800,000,000**, with a par value of **HKD 0.01** per share[75](index=75&type=chunk) [Treasury Policy](index=23&type=section&id=Treasury%20Policy) The Directors will continue to follow a prudent policy in managing cash balances and maintaining a strong and healthy liquidity position to capitalize on future growth opportunities - The Directors will adhere to a prudent policy in managing cash balances, maintaining a strong and healthy liquidity position to capitalize on future growth opportunities[76](index=76&type=chunk) [Other Information](index=24&type=section&id=Other%20Information) [Material Investments and Future Plans for Material Investments or Capital Assets](index=24&type=section&id=Material%20Investments%20and%20Future%20Plans%20for%20Material%20Investments%20or%20Capital%20Assets) As of June 30, 2025, the Group held no material investments and had no plans for any material investments or additions of other capital assets - As of June 30, 2025, the Group held no material investments and had no plans for any material investments or additions of other capital assets[77](index=77&type=chunk) [Material Acquisitions and Disposals of Subsidiaries, Associates and Joint Ventures](index=24&type=section&id=Material%20Acquisitions%20and%20Disposals%20of%20Subsidiaries%2C%20Associates%20and%20Joint%20Ventures) For the six months ended June 30, 2025, the Group had no material acquisitions or disposals of subsidiaries, associates, or joint ventures - For the six months ended June 30, 2025, the Group had no material acquisitions or disposals of subsidiaries, associates, or joint ventures[78](index=78&type=chunk) [Charge on the Group's Assets](index=24&type=section&id=Charge%20on%20the%20Group's%20Assets) As of June 30, 2025, bank deposits of HKD 2,400 thousand were pledged as security for the Group's bank facilities - As of June 30, 2025, bank deposits of **HKD 2,400 thousand** were pledged as security for the Group's bank facilities[79](index=79&type=chunk) [Contingent Liabilities](index=24&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[80](index=80&type=chunk) [Events After the Reporting Period](index=24&type=section&id=Events%20After%20the%20Reporting%20Period) As of the date of this announcement, no significant events affecting the Company or the Group have occurred after June 30, 2025 - As of the date of this announcement, no significant events affecting the Company or the Group have occurred after June 30, 2025[81](index=81&type=chunk) [Employees and Remuneration Policy](index=24&type=section&id=Employees%20and%20Remuneration%20Policy) As of June 30, 2025, the Group had 130 in-house employees and 2,650 seconded employees, with staff costs of approximately HKD 121,271 thousand, and remuneration is determined based on performance, qualifications, experience, and industry practice, with commissions and discretionary bonuses offered to attract and retain talent - As of June 30, 2025, the Group had **130** in-house employees and **2,650** seconded employees[82](index=82&type=chunk) - Staff costs (including directors' emoluments) amounted to approximately **HKD 121,271 thousand**[82](index=82&type=chunk) - Remuneration is determined based on performance, qualifications, experience, and industry practice, with commissions and discretionary bonuses offered to attract and retain talent[82](index=82&type=chunk) [Directors' and Major Shareholders' Interests](index=25&type=section&id=Directors'%20and%20Major%20Shareholders'%20Interests) [Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares and Debentures of the Company or any Associated Corporation](index=25&type=section&id=Directors'%20and%20Chief%20Executive's%20Interests%20and%20Short%20Positions%20in%20Shares%2C%20Underlying%20Shares%20and%20Debentures%20of%20the%20Company%20or%20any%20Associated%20Corporation) As of June 30, 2025, Mr. Chan Ka Kin, Mr. Chan Ka On, and Mr. Chan Ka Shing each held long positions in 600,000,000 shares of the Company, representing 75% of the issued share capital, through controlled corporations and concert party arrangements Directors' Long Positions in Shares of the Company (As of June 30) | Name of Director | Capacity/Nature of Interest | Number of Shares Held | Approximate Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | | Mr. Chan Ka Kin | Interest in controlled corporation and concert party | 600,000,000 | 75% | | Mr. Chan Ka On | Interest in controlled corporation and concert party | 600,000,000 | 75% | | Mr. Chan Ka Shing | Interest in controlled corporation and concert party | 600,000,000 | 75% | - Of the **600,000,000 shares**, **450,000,000** shares are registered in the name of KJE Limited, and **150,000,000** shares are registered in the name of Caiden Holdings Limited[84](index=84&type=chunk) - Mr. Chan Ka Kin, Mr. Chan Ka On, Mr. Chan Ka Shing, and Mr. Chow Ka Wai entered into a deed of concert party arrangement on **January 18, 2018**[84](index=84&type=chunk) [Major Shareholders' Interests and Short Positions in Shares, Debentures and Underlying Shares of the Company](index=26&type=section&id=Major%20Shareholders'%20Interests%20and%20Short%20Positions%20in%20Shares%2C%20Debentures%20and%20Underlying%20Shares%20of%20the%20Company) As of June 30, 2025, KJE Limited, Caiden Holdings Limited, and Mr. Chow Ka Wai each held long positions in 600,000,000 shares of the Company, representing 75% of the issued share capital, consistent with the directors' disclosure Major Shareholders' Long Positions in Shares of the Company (As of June 30) | Name/Designation of Major Shareholder | Capacity/Nature of Interest | Number of Shares Held | Approximate Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | | KJE Limited | Beneficial owner and concert party | 600,000,000 | 75% | | Caiden Holdings Limited | Beneficial owner and concert party | 600,000,000 | 75% | | Mr. Chow Ka Wai | Interest in controlled corporation and concert party | 600,000,000 | 75% | - KJE Limited is approximately **33.33%** owned by Mr. Chan Ka Kin, Mr. Chan Ka On, and Mr. Chan Ka Shing respectively, while Caiden Holdings Limited is wholly owned by Mr. Chow Ka Wai[86](index=86&type=chunk) [Share Option Scheme](index=27&type=section&id=Share%20Option%20Scheme) The Company adopted a share option scheme on September 13, 2018, to reward participants, valid for ten years, with the maximum number of shares to be issued upon exercise of options not exceeding 10% of the total issued shares at the time of adoption, and as of June 30, 2025, no share options were granted, exercised, cancelled, or lapsed - The Company adopted a share option scheme on **September 13, 2018**, valid for **ten years**, aiming to reward or incentivize selected participants[88](index=88&type=chunk)[89](index=89&type=chunk) - The maximum number of shares to be issued upon exercise of options shall not exceed **10%** of the total issued shares on the date of adoption of the scheme[90](index=90&type=chunk) - As of June 30, 2025, no share options under the scheme were granted, exercised, cancelled, or lapsed, and there were no outstanding share options[90](index=90&type=chunk) [Corporate Governance and Other Matters](index=28&type=section&id=Corporate%20Governance%20and%20Other%20Matters) [Directors' Rights to Acquire Shares or Debentures](index=28&type=section&id=Directors'%20Rights%20to%20Acquire%20Shares%20or%20Debentures) For the six months ended June 30, 2025, neither the Company, its subsidiaries, nor any associated corporations entered into any arrangements enabling directors (including their spouses and minor children) to acquire benefits by acquiring shares, underlying shares, or debentures of the Company or any associated corporation, and as of the date of this announcement, no share options have been granted to directors - For the six months ended June 30, 2025, the Company did not enter into any arrangements enabling directors to profit from acquiring shares or debentures[91](index=91&type=chunk) - As of the date of this announcement, the Company has not granted any share options to directors[91](index=91&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=28&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company's%20Listed%20Securities) For the six months ended June 30, 2025, neither the Company nor 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[92](index=92&type=chunk) [Competing Interests](index=28&type=section&id=Competing%20Interests) For the six months ended June 30, 2025, none of the directors, controlling shareholders, or their close associates held any interests in businesses that compete or are likely to compete with the Group's business - For the six months ended June 30, 2025, none of the directors, controlling shareholders, or their close associates held any interests in businesses that compete or are likely to compete with the Group's business[93](index=93&type=chunk) [Corporate Governance Practices](index=28&type=section&id=Corporate%20Governance%20Practices) The Company has complied with the code provisions of the Corporate Governance Code as set out in Appendix C1 Part 2 of the GEM Listing Rules for the six months ended June 30, 2025 - The Company complied with the code provisions of the Corporate Governance Code in Appendix C1 Part 2 of the GEM Listing Rules for the six months ended June 30, 2025[94](index=94&type=chunk) [Directors' Securities Transactions](index=28&type=section&id=Directors'%20Securities%20Transactions) The Company adopted the required standard of dealings as set out in Rules 5.48 to 5.67 of the GEM Listing Rules for directors' securities transactions, and all directors confirmed compliance during the reporting period - The Company adopted the required standard of dealings as set out in Rules 5.48 to 5.67 of the GEM Listing Rules for directors' securities transactions[95](index=95&type=chunk) - All directors confirmed compliance with this standard for the six months ended June 30, 2025[95](index=95&type=chunk) [Audit Committee](index=28&type=section&id=Audit%20Committee) The Board's Audit Committee comprises three independent non-executive directors, with Mr. Poon Kai Kin as chairman, and the committee reviewed the unaudited condensed consolidated financial statements for the six months ended June 30, 2025, providing advice and recommendations - The Audit Committee comprises three independent non-executive directors, with Mr. Poon Kai Kin as chairman[96](index=96&type=chunk) - The committee's primary responsibilities include recommending the appointment and removal of external auditors, reviewing and overseeing financial statements, and supervising internal control procedures and risk management systems[97](index=97&type=chunk) - The Audit Committee reviewed the unaudited condensed consolidated financial statements for the six months ended June 30, 2025[97](index=97&type=chunk) [By Order of the Board](index=29&type=section&id=By%20Order%20of%20the%20Board) This announcement was issued by Mr. Chan Ka Kin, Chairman of the Board, on August 22, 2025, and the Board comprises four executive directors and three independent non-executive directors - This announcement was issued by Mr. Chan Ka Kin, Chairman of the Board, on **August 22, 2025**[98](index=98&type=chunk)[99](index=99&type=chunk) - The Board comprises four executive directors (Chan Ka Kin, Chan Ka On, Chan Ka Shing, Yeung Shek Shek) and three independent non-executive directors (Poon Kai Kin, Lau Kin Shing, Cheung Wang Ki)[99](index=99&type=chunk)

Overall Performance Overview [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=2&type=section&id=1.%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the financial year ended June 30, 2025, the Group's revenue slightly increased by 1.3% to RMB 56,697 thousand, but loss for the year narrowed by 23.5% to RMB 57,019 thousand due to fair value loss on investment properties, loss on disposal of assets, and increased taxation. EBITDA decreased by 48.7% Consolidated Statement of Profit or Loss and Other Comprehensive Income Key Data | Indicator | FY2024/25 (RMB thousand) | FY2023/24 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 56,697 | 55,969 | 1.3 | | Employee Costs | (6,664) | (5,455) | 22.2 | | Operating Loss | (30,354) | (67,115) | (54.8) | | Loss Before Income Tax | (44,883) | (83,528) | (46.3) | | Loss for the Year | (57,019) | (74,576) | (23.5) | | EBITDA | 13,898 | 27,092 | (48.7) | | Loss Attributable to Owners of the Company | (56,558) | (73,861) | (23.4) | | Basic Loss Per Share (RMB) | (0.31) | (0.41) | (24.4) | - Other comprehensive income for the year turned from a loss of **RMB 13,363 thousand** in FY2023/24 to a gain of **RMB 31,987 thousand** in FY2024/25, primarily due to exchange differences arising from the translation of overseas operations[5](index=5&type=chunk) [Consolidated Statement of Financial Position](index=5&type=section&id=2.%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group's total assets decreased to RMB 1,593,209 thousand, net current liabilities expanded to RMB 33,971 thousand, and net assets slightly declined. Investment properties remain the primary asset, but their fair value has decreased Consolidated Statement of Financial Position Key Data | Indicator | June 30, 2025 (RMB thousand) | June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Total Non-Current Assets | 1,519,059 | 1,597,179 | | Total Current Assets | 74,150 | 203,614 | | Total Current Liabilities | 108,121 | 210,510 | | Net Current Liabilities | (33,971) | (6,896) | | Net Assets | 1,120,475 | 1,145,507 | | Total Equity | 1,120,475 | 1,145,507 | - Cash and cash equivalents significantly decreased from **RMB 69,664 thousand** as of June 30, 2024, to **RMB 1,388 thousand** as of June 30, 2025[7](index=7&type=chunk) - Trade and other receivables significantly increased from **RMB 23,950 thousand** as of June 30, 2024, to **RMB 53,072 thousand** as of June 30, 2025[7](index=7&type=chunk) Notes to the Condensed Consolidated Financial Statements [General Information](index=7&type=section&id=3.1%20General%20Information) The Company is incorporated in Hong Kong, primarily providing education facility leasing services in China, Malaysia, and Indonesia, and hotel property leasing and management in Switzerland. The ultimate parent company is Raffles Education Corporation Limited, listed in Singapore - The Group's principal activities are providing education facility leasing services in China, Malaysia, and Indonesia, and leasing and managing hotel properties in Switzerland[9](index=9&type=chunk) - The Company's ultimate parent company is Raffles Education Corporation Limited, incorporated and listed in Singapore[9](index=9&type=chunk) [Basis of Preparation](index=7&type=section&id=3.2%20Basis%20of%20Preparation) The consolidated financial statements are prepared under HKFRSs and the Hong Kong Companies Ordinance, using historical cost except for investment properties and assets held for sale measured at fair value. Despite losses, net current liabilities, and cash shortages, the Board believes the Group can operate on a going concern basis due to several liquidity improvement measures - The consolidated financial statements are prepared on a historical cost basis, except for investment properties and assets held for sale which are measured at fair value[11](index=11&type=chunk) - The Group recorded a loss of **RMB 57,019 thousand**, net current liabilities of approximately **RMB 33,971 thousand**, and cash and cash equivalents of approximately **RMB 1,388 thousand** in FY2024/25, yet the Board prepared the financial statements on a going concern basis[12](index=12&type=chunk) - To improve liquidity, the Group plans to utilize an unutilized revolving loan facility of **RMB 40 million** from Raffles, negotiate extensions for existing bank loans of **RMB 64 million**, expects to receive proceeds from the disposal of assets held for sale and termination of investment property acquisition, and considers disposing of certain investment properties for funds[14](index=14&type=chunk) [Adoption of New/Revised Hong Kong Financial Reporting Standards](index=9&type=section&id=3.3%20Adoption%20of%20New%2FRevised%20Hong%20Kong%20Financial%20Reporting%20Standards) The Group has adopted certain revised HKFRSs with no material impact on current or prior period results and financial position. Newly issued but not yet effective standards, particularly HKFRS 18, are expected to significantly affect financial statement presentation and disclosure without impacting recognition and measurement - Adopted amendments to HKFRSs (e.g., HKAS 1, HKFRS 16) had no material impact on the Group's results and financial position for the current or prior periods[15](index=15&type=chunk) - Newly issued but not yet effective HKFRS 18 'Presentation and Disclosure in Financial Statements' will replace HKAS 1 and is expected to have a significant impact on the presentation and disclosure of certain items in the consolidated financial statements, including classification and subtotals in the statement of profit or loss[17](index=17&type=chunk) [Revenue and Segment Information](index=10&type=section&id=3.4%20Revenue%20and%20Segment%20Information) Revenue for the financial year slightly increased by 1.3% to RMB 56,697 thousand, primarily from education facility leasing and hotel property leasing. Education facility leasing revenue slightly decreased, while hotel property leasing revenue, especially floating lease payments, significantly grew. Revenue from China decreased, while non-China regions (Malaysia, Indonesia, and Switzerland) saw significant growth. The Group's major customers include Customer A, Customer B, and Raffles Group Revenue Analysis by Category | Revenue Source | FY2024/25 (RMB thousand) | FY2023/24 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Education Facility Leasing | 47,710 | 49,293 | (3.2) | | Ancillary Facility Commercial Leasing | 2,938 | 2,779 | 5.7 | | Hotel Properties — Fixed Lease Payments | 3,888 | 2,940 | 32.2 | | Hotel Properties — Floating Lease Payments | 2,161 | 957 | 125.8 | | **Total Revenue** | **56,697** | **55,969** | **1.3** | Revenue Analysis by Country | Region | FY2024/25 (RMB thousand) | FY2023/24 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | China | 44,905 | 46,519 | (3.4) | | Non-China (Malaysia, Indonesia, and Switzerland) | 11,792 | 9,450 | 24.8 | | **Total Revenue** | **56,697** | **55,969** | **1.3** | - Major customers include Customer A (revenue **RMB 18,284 thousand**, up **4.4%** year-on-year), Customer B (revenue **RMB 11,824 thousand**, up **17.5%** year-on-year), and Raffles Group (revenue **RMB 5,792 thousand**)[28](index=28&type=chunk) [Net Other Income](index=15&type=section&id=3.5%20Net%20Other%20Income) Net other income for the financial year significantly decreased by 67.3% to RMB 1,738 thousand, mainly due to reduced net exchange gains and the absence of bargain purchase gains Net Other Income Details | Item | FY2024/25 (RMB thousand) | FY2023/24 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Net Exchange Gains | 1,183 | 2,672 | (55.7) | | Bargain Purchase Gains | — | 2,352 | N/M | | Others | 555 | 289 | 92.0 | | **Total** | **1,738** | **5,313** | **(67.3)** | [Loss Before Income Tax](index=15&type=section&id=3.6%20Loss%20Before%20Income%20Tax) Loss before income tax is calculated after deducting various expenses, including auditor's remuneration, direct operating expenses for investment properties, and short-term lease expenses Deductions for Loss Before Income Tax | Item | FY2024/25 (RMB thousand) | FY2023/24 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Auditor's Remuneration | 767 | 901 | (14.9) | | Direct Operating Expenses for Investment Properties Generating Rental Income During the Year | 16,721 | 14,289 | 17.0 | | Direct Operating Expenses for Investment Properties Not Generating Rental Income During the Year | 4,311 | 6,498 | (33.7) | | Short-Term Lease Expenses | 1,086 | — | N/M | [Income Tax](index=16&type=section&id=3.7%20Income%20Tax) Income tax expense for the financial year shifted from a loss to a gain, primarily due to a significant increase in current tax (especially land appreciation tax and China corporate income tax) and increased deferred tax credits Income Tax Details | Item | FY2024/25 (RMB thousand) | FY2023/24 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Current Tax | 31,167 | 4,856 | 541.8 | | — China Corporate Income Tax | 13,928 | 394 | 3,435.0 | | — Land Appreciation Tax | 14,595 | — | N/M | | Deferred Tax | (19,031) | (13,808) | 37.8 | | **Income Tax** | **12,136** | **(8,952)** | **N/M** | - The Group had no assessable profits in Hong Kong, thus no provision for Hong Kong profits tax was made[32](index=32&type=chunk) [Loss Per Share](index=17&type=section&id=3.8%20Loss%20Per%20Share) Basic and diluted loss per share for the financial year was RMB 0.31, narrowing from RMB 0.41 last year, mainly due to a decrease in loss attributable to owners of the Company Loss Per Share Data | Indicator | FY2024/25 | FY2023/24 | | :--- | :--- | :--- | | Loss Attributable to Owners of the Company (RMB thousand) | (56,558) | (73,861) | | Weighted Average Number of Ordinary Shares in Issue (thousand shares) | 180,000 | 180,000 | | Basic Loss Per Share (RMB per share) | (0.31) | (0.41) | | Diluted Loss Per Share (RMB per share) | (0.31) | (0.41) | - The Company had no outstanding potential ordinary shares during the reporting period, so diluted loss per share equals basic loss per share[34](index=34&type=chunk) [Investment Properties](index=17&type=section&id=3.9%20Investment%20Properties) Fair value of investment properties at the end of the financial year was RMB 1,486,379 thousand, a decrease from last year, mainly affected by fair value changes and disposals, but with a positive impact from exchange adjustments. Investment properties are valued annually by independent valuers Changes in Fair Value of Investment Properties | Item | FY2024/25 (RMB thousand) | FY2023/24 (RMB thousand) | | :--- | :--- | :--- | | Fair Value at Beginning of Year | 1,533,592 | 1,458,878 | | Additions | 3,078 | 8,342 | | Disposals | (22,060) | — | | Reclassified to Assets Held for Sale | (19,690) | (110,000) | | Exchange Adjustments | 42,404 | (14,753) | | Changes in Fair Value | (38,645) | (93,813) | | **Fair Value at End of Year** | **1,486,379** | **1,533,592** | - The fair value of investment properties is a Level 3 recurring fair value measurement, independently valued by external independent professional qualified valuers[36](index=36&type=chunk) [Investment in an Associate](index=18&type=section&id=3.10%20Investment%20in%20an%20Associate) The carrying amount of investment in an associate at the end of the financial year was RMB 8,809 thousand, a decrease from last year, primarily due to the recognition of an impairment loss of RMB 3,178 thousand. The acquisition of 4 Vallees Pte Ltd was completed last year, making it a wholly-owned subsidiary Carrying Amount of Investment in an Associate | Item | June 30, 2025 (RMB thousand) | June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Share of Net Assets Excluding Goodwill | 9,335 | 9,508 | | Goodwill | 2,652 | 2,652 | | Accumulated Impairment Loss | (3,178) | — | | **Carrying Amount** | **8,809** | **12,160** | - An impairment loss of **RMB 3,178 thousand** was recognized in FY2024/25 because the fair value less costs to sell of the associate, Axiom Properties Limited, was lower than its carrying amount[37](index=37&type=chunk) - The Company completed the acquisition of **75.39%** equity interest in 4 Vallees Pte Ltd in FY2023/24, making it a wholly-owned subsidiary[37](index=37&type=chunk) [Prepayments](index=19&type=section&id=3.11%20Prepayments) Prepayments significantly decreased to RMB 335 thousand at the end of the financial year, mainly due to the reclassification of prepayments for the terminated acquisition of Mongolian property to other receivables, and partial refund of prepayments for renovation works of investment properties in Langfang City Prepayments Details | Item | June 30, 2025 (RMB thousand) | June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Prepayments for Acquisition of Investment Properties | — | 28,430 | | Prepayments for Various Renovation and Construction Works | 335 | 9,041 | | **Total** | **335** | **37,471** | - Prepayments of **RMB 28,430 thousand** for the terminated acquisition of Mongolian property were reclassified to 'Other receivables' in FY2024/25, with the seller to pay termination amounts in installments[38](index=38&type=chunk) - Of the prepayments for renovation and construction works of investment properties in Langfang City, **RMB 8,706 thousand** was refunded by the construction company[38](index=38&type=chunk) [Trade and Other Receivables](index=20&type=section&id=3.12%20Trade%20and%20Other%20Receivables) Total trade and other receivables increased to RMB 54,865 thousand at the end of the financial year, primarily due to the recognition of receivables from the terminated acquisition of investment properties. Impairment provisions also increased Trade and Other Receivables Details | Item | June 30, 2025 (RMB thousand) | June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Trade Receivables, Net of Provision | 23,355 | 17,687 | | Other Receivables and Prepayments | 16,167 | 10,629 | | Receivables from Terminated Acquisition of Investment Properties | 20,008 | — | | Other Recoverable Taxes | 3,326 | 3,166 | | Less: Impairment Provision | (7,991) | (5,937) | | **Total** | **54,865** | **25,545** | - Receivables from the terminated acquisition of investment properties, amounting to **RMB 20,008 thousand**, were newly recognized this period, being the main reason for the increase in total receivables[39](index=39&type=chunk) - The aging analysis of trade receivables shows that most receivables are due within three months[42](index=42&type=chunk) [Trade and Other Payables and Accrued Expenses](index=22&type=section&id=3.13%20Trade%20and%20Other%20Payables%20and%20Accrued%20Expenses) Total trade and other payables and accrued expenses significantly decreased to RMB 62,669 thousand at the end of the financial year, mainly due to a substantial reduction in deposits received as the transaction for deposits received last year for the disposal of investment properties was completed Trade and Other Payables and Accrued Expenses Details | Item | June 30, 2025 (RMB thousand) | June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Trade Payables | 2,226 | 3,064 | | Other Payables and Accrued Expenses | 14,751 | 15,968 | | Deposits Received | 5,000 | 110,000 | | Amounts Due to Raffles Group | 40,692 | 52,574 | | **Total** | **62,669** | **181,606** | - Deposits received significantly decreased from **RMB 110,000 thousand** last year to **RMB 5,000 thousand**, primarily because the transaction for deposits received last year for the disposal of certain investment properties was completed[43](index=43&type=chunk) - Amounts due to Raffles Group are unsecured, interest-free, and not repayable before July 1, 2026[43](index=43&type=chunk) [Bank Borrowings, Secured](index=23&type=section&id=3.14%20Bank%20Borrowings,%20Secured) Total bank borrowings decreased to RMB 246,003 thousand at the end of the financial year, with RMB 77,632 thousand due for repayment within one year. Bank borrowings are secured by investment properties, corporate guarantees, equity pledges, pledged bank deposits, and rental income from Swiss hotel properties Bank Borrowings Maturity Analysis | Maturity Period | June 30, 2025 (RMB thousand) | June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Within One Year | 77,632 | 71,135 | | After One Year but Within Two Years | 23,109 | 73,923 | | After Two Years but Within Five Years | 60,529 | 53,453 | | After Five Years | 84,733 | 91,762 | | **Total** | **246,003** | **290,273** | - Bank borrowing interest rates range from **2.00% to 8.95%** per annum (last year: **3.04% to 8.95%**)[44](index=44&type=chunk) - Bank borrowings are secured by certain investment properties of the Group (**RMB 1,249,969 thousand**), corporate guarantees from the Company and subsidiaries, equity pledges, pledged bank deposits (**RMB 8,967 thousand**), and rental income from Swiss hotel properties[44](index=44&type=chunk) Financial Review for the Year Ended June 30, 2025 [Revenue](index=24&type=section&id=4.1%20Revenue) Revenue for the financial year increased by 1.3% to RMB 56.70 million, primarily driven by rising contractual rents from educational institutions within the Oriental University City campus Revenue Changes | Indicator | FY2024/25 (RMB million) | FY2023/24 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 56.70 | 55.97 | 1.3 | - Revenue growth was mainly attributable to increased contractual rents from several educational institutions within the Oriental University City campus in Langfang City, Hebei Province, China[45](index=45&type=chunk) [Employee Costs](index=24&type=section&id=4.2%20Employee%20Costs) Employee costs increased by 22.2% to RMB 6.66 million, mainly due to the full-year recognition of staff costs in this financial year following the completion of the 4 Vallees acquisition in the latter half of last year Employee Costs Changes | Indicator | FY2024/25 (RMB million) | FY2023/24 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Employee Costs | 6.66 | 5.46 | 22.2 | - The increase in employee costs was mainly due to the full-year recognition of staff costs in FY2024/25 following the completion of the 4 Vallees acquisition in the latter half of FY2023/24[46](index=46&type=chunk) [Property Tax and Land Use Tax](index=24&type=section&id=4.3%20Property%20Tax%20and%20Land%20Use%20Tax) Property tax and land use tax decreased by 14.6% to RMB 8.97 million, primarily due to the disposal of several properties within the Oriental University City campus Property Tax and Land Use Tax Changes | Indicator | FY2024/25 (RMB million) | FY2023/24 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Property Tax and Land Use Tax | 8.97 | 10.50 | (14.6) | - The decrease in taxes was mainly due to the disposal of several properties within the Oriental University City campus, with a total land area of **81,717 square meters** and a gross floor area of **60,001 square meters**[47](index=47&type=chunk) [Property Management Fees](index=24&type=section&id=4.4%20Property%20Management%20Fees) Property management fees increased by 8.1% to RMB 3.34 million, due to the full-year recognition of property management costs for 4 Vallees following the completion of its acquisition in this financial year Property Management Fees Changes | Indicator | FY2024/25 (RMB million) | FY2023/24 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Property Management Fees | 3.34 | 3.09 | 8.1 | - The increase in property management fees was due to the full-year recognition of 4 Vallees' property management costs following the completion of the 4 Vallees acquisition in the latter half of FY2023/24[48](index=48&type=chunk) [Repair and Maintenance Expenses](index=24&type=section&id=4.5%20Repair%20and%20Maintenance%20Expenses) Repair and maintenance expenses increased by 43.1% to RMB 1.90 million, primarily due to more regular maintenance works being carried out Repair and Maintenance Expenses Changes | Indicator | FY2024/25 (RMB million) | FY2023/24 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Repair and Maintenance Expenses | 1.90 | 1.33 | 43.1 | - The increase in repair and maintenance expenses was due to more regular maintenance works being carried out[49](index=49&type=chunk) [Legal and Professional Fees](index=25&type=section&id=4.6%20Legal%20and%20Professional%20Fees) Legal and professional fees decreased by 36.6% to RMB 3.70 million, mainly due to fewer professional fees incurred from corporate activities in this financial year Legal and Professional Fees Changes | Indicator | FY2024/25 (RMB million) | FY2023/24 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Legal and Professional Fees | 3.70 | 5.84 | (36.6) | - The decrease in legal and professional fees was due to fewer professional fees incurred from corporate activities in FY2024/25[50](index=50&type=chunk) [Loss on Disposal of Investment Properties and Assets Held for Sale](index=25&type=section&id=4.7%20Loss%20on%20Disposal%20of%20Investment%20Properties%20and%20Assets%20Held%20for%20Sale) A loss of RMB 11.36 million on the disposal of investment properties and assets held for sale was recorded in this financial year, primarily attributable to property disposal events in FY2024/25 Loss on Disposal of Investment Properties and Assets Held for Sale | Indicator | FY2024/25 (RMB million) | FY2023/24 (RMB million) | | :--- | :--- | :--- | | Loss on Disposal | 11.36 | — | - This loss was attributable to property disposal events in FY2024/25[51](index=51&type=chunk) [Net Other Income](index=25&type=section&id=4.8%20Net%20Other%20Income) Net other income decreased by 67.3% to RMB 1.74 million, mainly due to reduced net exchange gains and the absence of any acquisition gains Net Other Income Changes | Indicator | FY2024/25 (RMB million) | FY2023/24 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Net Other Income | 1.74 | 5.31 | (67.3) | - The decrease was mainly due to reduced net exchange gains and the absence of any acquisition gains[52](index=52&type=chunk) [Other Expenses](index=25&type=section&id=4.9%20Other%20Expenses) Other expenses increased by 88.0% to RMB 6.25 million, primarily due to new property rental costs for overseas property management and compensation paid to tenants for early lease termination Other Expenses Changes | Indicator | FY2024/25 (RMB million) | FY2023/24 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Other Expenses | 6.25 | 3.33 | 88.0 | - The increase was mainly due to new property rental costs for overseas property management and compensation paid to tenants for early lease termination[53](index=53&type=chunk) [Share of Results of an Associate](index=25&type=section&id=4.10%20Share%20of%20Results%20of%20an%20Associate) Share of loss from an associate decreased by 31.3% to RMB 2.15 million, due to a reduction in the net loss recorded by its associate Share of Results of an Associate Changes | Indicator | FY2024/25 (RMB million) | FY2023/24 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Share of Loss from Associate | 2.15 | 3.13 | (31.3) | - The decrease in loss was due to a reduction in the net loss recorded by its associate[54](index=54&type=chunk) [Impairment Loss on an Associate](index=25&type=section&id=4.11%20Impairment%20Loss%20on%20an%20Associate) An impairment loss of RMB 3.18 million on an associate was recognized in this financial year, as the fair value less costs to sell of the shares held in the associate was lower than its carrying amount Impairment Loss on an Associate | Indicator | FY2024/25 (RMB million) | FY2023/24 (RMB million) | | :--- | :--- | :--- | | Impairment Loss | 3.18 | — | - The impairment loss was due to the fair value less costs to sell of the shares held in the associate being lower than its carrying amount[55](index=55&type=chunk) [Impairment Loss on Other Receivables](index=26&type=section&id=4.12%20Impairment%20Loss%20on%20Other%20Receivables) An impairment provision of RMB 2.05 million was made for other receivables in this financial year, mainly for the remaining consideration to be received from the termination deed for the purchase of Mongolian investment properties Impairment Loss on Other Receivables | Indicator | FY2024/25 (RMB million) | FY2023/24 (RMB million) | | :--- | :--- | :--- | | Impairment Loss | 2.05 | — | - The impairment provision was made based on the remaining consideration of **RMB 20.01 million** to be received from the termination deed, with reference to an expected credit loss assessment performed by an independent valuer[56](index=56&type=chunk) [Fair Value Loss on Investment Properties](index=26&type=section&id=4.13%20Fair%20Value%20Loss%20on%20Investment%20Properties) Fair value loss on investment properties decreased by 58.8% to RMB 38.65 million, primarily attributable to the decrease in fair value of investment properties in the Oriental University City campus Fair Value Loss on Investment Properties Changes | Indicator | FY2024/25 (RMB million) | FY2023/24 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Fair Value Loss | 38.65 | 93.81 | (58.8) | - The fair value loss was primarily attributable to the decrease in fair value of investment properties located in the Oriental University City campus[57](index=57&type=chunk) [Operating Loss](index=26&type=section&id=4.14%20Operating%20Loss) Operating loss decreased by 54.8% to RMB 30.35 million, mainly due to the combined effect of the aforementioned changes in revenue and expenses Operating Loss Changes | Indicator | FY2024/25 (RMB million) | FY2023/24 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Operating Loss | 30.35 | 67.12 | (54.8) | - The decrease in operating loss was due to the combined effect of changes in revenue and expenses as set out in notes 4.1 to 4.13[58](index=58&type=chunk) [Interest Expense on Bank Borrowings](index=26&type=section&id=4.15%20Interest%20Expense%20on%20Bank%20Borrowings) Interest expense on bank borrowings decreased by 11.4% to RMB 14.56 million, primarily due to more loan principal being progressively repaid Interest Expense on Bank Borrowings Changes | Indicator | FY2024/25 (RMB million) | FY2023/24 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Interest Expense | 14.56 | 16.43 | (11.4) | - The decrease in interest expense was due to more loan principal being progressively repaid[59](index=59&type=chunk) [Current Tax](index=26&type=section&id=4.16%20Current%20Tax) Current tax expense significantly increased by 541.8% to RMB 31.17 million, mainly due to land appreciation tax and increased corporate income from property disposal events in FY2024/25 Current Tax Expense Changes | Indicator | FY2024/25 (RMB million) | FY2023/24 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Current Tax Expense | 31.17 | 4.86 | 541.8 | - The increase was mainly due to land appreciation tax and increased corporate income from property disposal events in FY2024/25[60](index=60&type=chunk) [Deferred Tax](index=26&type=section&id=4.17%20Deferred%20Tax) Deferred tax credit increased by 37.8% to RMB 19.03 million, primarily due to the reversal of deferred tax from property disposal events in FY2024/25 Deferred Tax Credit Changes | Indicator | FY2024/25 (RMB million) | FY2023/24 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Deferred Tax Credit | 19.03 | 13.81 | 37.8 | - The increase was mainly due to the reversal of deferred tax from property disposal events in FY2024/25[61](index=61&type=chunk) [Loss for the Year](index=27&type=section&id=4.18%20Loss%20for%20the%20Year) Loss for the year was RMB 57.02 million, a 23.5% reduction from RMB 74.58 million last year, despite losses from investment property disposals and fair value losses Loss for the Year Changes | Indicator | FY2024/25 (RMB million) | FY2023/24 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Loss for the Year | 57.02 | 74.58 | (23.5) | - The decrease in loss was mainly influenced by the narrowing operating loss, despite a loss of **RMB 11.36 million** on disposal of investment properties and assets held for sale, and a fair value loss of **RMB 38.65 million** on investment properties[62](index=62&type=chunk) [EBITDA](index=27&type=section&id=4.19%20EBITDA) EBITDA for the financial year was RMB 13.90 million, a 48.7% decrease from RMB 27.09 million last year EBITDA Changes | Indicator | FY2024/25 (RMB million) | FY2023/24 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | EBITDA | 13.90 | 27.09 | (48.7) | [Liquidity and Financial Resources](index=27&type=section&id=4.20%20Liquidity%20and%20Financial%20Resources) Net current liabilities expanded to RMB 33.97 million at the end of the financial year. Despite this, the Board believes the Group has sufficient working capital for the next 12 months, relying on unutilized loan facilities, bank loan extension negotiations, expected asset disposal proceeds, and potential investment property sales Net Current Liabilities Changes | Indicator | June 30, 2025 (RMB million) | June 30, 2024 (RMB million) | | :--- | :--- | :--- | | Net Current Liabilities | 33.97 | 6.90 | - The Group has an unutilized revolving loan facility of **RMB 40.00 million** from Raffles and has been negotiating with banks for extensions of existing bank loans totaling **RMB 64.00 million**[65](index=65&type=chunk) - Expected receivables from the disposal of assets held for sale and termination of investment property acquisition are anticipated to be fully collected in FY2025/26, and the Group is considering disposing of certain investment properties to provide further funds[65](index=65&type=chunk) [Gearing Ratio](index=28&type=section&id=4.21%20Gearing%20Ratio) The gearing ratio at the end of the financial year was 21.96%, a decrease from 25.34% last year, reflecting a reduction in total borrowings Gearing Ratio Changes | Indicator | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Gearing Ratio | 21.96% | 25.34% | | Total Borrowings (RMB million) | 246.00 | 290.27 | | Total Equity (RMB million) | 1,120.48 | 1,145.51 | [Cash and Cash Equivalents](index=28&type=section&id=4.22%20Cash%20and%20Cash%20Equivalents) Cash and cash equivalents significantly decreased to RMB 1.39 million at the end of the financial year. The Group places cash exceeding daily operational needs into fixed deposits and currently does not invest in other financial instruments Cash and Cash Equivalents Changes | Indicator | June 30, 2025 (RMB million) | June 30, 2024 (RMB million) | | :--- | :--- | :--- | | Cash and Cash Equivalents | 1.39 | 69.66 | - The Group places high importance on risk management, depositing cash exceeding daily operational needs into fixed deposits, and currently does not invest in bonds, notes, structured products, or any other financial instruments[68](index=68&type=chunk) [Foreign Exchange Hedging](index=28&type=section&id=4.23%20Foreign%20Exchange%20Hedging) The Group's foreign currency risk is limited as most transactions are denominated in RMB, and it currently does not engage in any foreign exchange hedging, but the Board will closely monitor and may consider a hedging policy in the future - The Group's foreign currency risk is limited as most transactions are denominated in RMB, the functional currency of its operations[69](index=69&type=chunk) - The Group currently does not engage in any foreign exchange hedging, but the Board closely monitors foreign exchange risk and may adopt a significant foreign currency hedging policy in the future[69](index=69&type=chunk) [Business Review and Outlook](index=28&type=section&id=5.%20Business%20Review%20and%20Outlook) The Group primarily leases education facilities in China, Malaysia, and Indonesia, and manages hotel properties in Switzerland. Despite market challenges, revenue grew by 1.3% this financial year, with both operating loss and loss for the year narrowing. The Group rationalized assets by disposing of low-yielding properties, using proceeds to upgrade investment properties and reduce bank borrowings. The Board is optimistic about future financial performance, anticipating sustainable demand for education facilities and moderate growth in the Swiss hotel sector - The Group's principal activities are leasing education facilities to educational institutions in China, Malaysia, and Indonesia, and owning, leasing, and managing hotel properties in Switzerland[70](index=70&type=chunk) - Revenue for the financial year increased by **1.3%** to **RMB 56.70 million**, operating loss decreased by **54.8%** to **RMB 30.35 million**, and loss for the year decreased by **23.5%** to **RMB 57.02 million**[71](index=71&type=chunk) - The Group rationalized assets by disposing of low-yielding investment properties (three disposals totaling **RMB 132.00 million** in this financial year), with proceeds used to upgrade investment properties in the Oriental University City campus, increase working capital, and reduce bank borrowings[72](index=72&type=chunk) - The Board expects sustainable demand for education facilities in the Oriental University City campus, Malaysia, and Indonesia, and moderate growth in the Swiss hotel sector to benefit the Group, anticipating further improvement in future financial performance[73](index=73&type=chunk) Significant Investments and Future Plans for Major Investments and Capital Commitments [Renovation and Refurbishment of Two Dormitories](index=30&type=section&id=6.1%20Renovation%20and%20Refurbishment%20of%20Two%20Dormitories) Renovation/refurbishment works for two dormitories in the Oriental University City campus have been completed and delivered, now leased by an educational institution. The contract amount was RMB 10.18 million, with RMB 9.87 million paid by the Group - Renovation/refurbishment works for Dormitories No. 23 and 24 in the Oriental University City campus were completed and delivered in the financial year ended June 30, 2023, and are leased by an educational institution[74](index=74&type=chunk) Financial Data for Dormitory Renovation/Refurbishment Project | Item | Amount (RMB million) | | :--- | :--- | | Contract Amount | 10.18 | | Amount Paid (as of June 30, 2025) | 9.87 | | Remaining Balance | 0.31 | [Construction of Canteen and Theatre](index=30&type=section&id=6.2%20Construction%20of%20Canteen%20and%20Theatre) Construction of the canteen and theatre in the Oriental University City campus was completed and delivered in the first half of this financial year, now leased by an educational institution. The contract amount was RMB 13.40 million, with RMB 11.53 million paid by the Group - Construction of the canteen and theatre in the Oriental University City campus was completed and delivered in the first half of FY2024/25 and is leased by an educational institution[75](index=75&type=chunk) Financial Data for Canteen and Theatre Construction Project | Item | Amount (RMB million) | | :--- | :--- | | Contract Amount | 13.40 | | Amount Paid (as of June 30, 2025) | 11.53 | | Remaining Balance | 3.97 | [Significant Acquisitions or Disposals of Subsidiaries, Associates, and Joint Ventures](index=30&type=section&id=7.%20Significant%20Acquisitions%20or%20Disposals%20of%20Subsidiaries,%20Associates,%20and%20Joint%20Ventures) In this financial year, the Group did not undertake any significant acquisitions or disposals of subsidiaries, associates, or joint ventures - In FY2024/25, the Group did not undertake any significant acquisitions or disposals of subsidiaries, associates, or joint ventures[76](index=76&type=chunk) Related Party Transactions and Continuing Connected Transactions [(a) Malaysia Property Lease Agreement](index=31&type=section&id=(a)%20Malaysia%20Property%20Lease%20Agreement) OUCMY, a subsidiary of the Company, renewed its Malaysia property lease agreement with RCHE, a Raffles Group entity, for three years, with an annual rent of 2.01 million Malaysian Ringgit (approximately RMB 3.30 million) - OUCMY and RCHE entered into a new lease agreement on December 12, 2024, renewing the Malaysia property lease for three years, from January 1, 2025, to December 31, 2027[78](index=78&type=chunk) Key Data for Malaysia Property Lease Agreement | Item | Amount | | :--- | :--- | | Annual Rent | 2.01 million Malaysian Ringgit (approximately RMB 3.30 million) | [(b) Indonesia Property Lease Agreement](index=31&type=section&id=(b)%20Indonesia%20Property%20Lease%20Agreement) PT OUC Thamrin Indo, a subsidiary of the Company, entered into an Indonesia property lease agreement with PT. Rafes Institute of Higher Education, a wholly-owned subsidiary of Raffles, for three years, with an annual rent of 5,472 million Indonesian Rupiah (approximately RMB 2.41 million) - PT OUC Thamrin Indo entered into an Indonesia property lease agreement with PT. Rafes Institute of Higher Education for three years, commencing July 1, 2023, and expiring June 30, 2026[79](index=79&type=chunk) Key Data for Indonesia Property Lease Agreement | Item | Amount | | :--- | :--- | | Annual Rent | 5,472 million Indonesian Rupiah (approximately RMB 2.41 million) | [(c) Singapore Property Lease Agreement](index=32&type=section&id=(c)%20Singapore%20Property%20Lease%20Agreement) Langfang Development Zone Oriental University City Education Consulting Co., Ltd., a subsidiary of the Company, entered into a Singapore property lease agreement with Raffles College of Higher Education Pte Ltd, a wholly-owned subsidiary of Raffles, for ten months, with an annual rent of 0.2 million Singapore Dollars (approximately RMB 1.12 million), to be renewed for one year - A subsidiary of the Company entered into a Singapore property lease agreement with a wholly-owned subsidiary of Raffles for ten months, commencing September 1, 2024, and expiring June 30, 2025[80](index=80&type=chunk) Key Data for Singapore Property Lease Agreement | Item | Amount | | :--- | :--- | | Rent Payable (first ten months) | 0.2 million Singapore Dollars (approximately RMB 1.12 million) | | Annual Rent (for one-year renewal) | 0.26 million Singapore Dollars (approximately RMB 1.46 million) | [(d) Management Services Provided by Raffles Group](index=32&type=section&id=(d)%20Management%20Services%20Provided%20by%20Raffles%20Group) Rafes K12 Sdn Bhd, a wholly-owned subsidiary of Raffles, provided management services to 4 Vallees Pte Ltd, a wholly-owned subsidiary of the Company, receiving approximately RMB 0.4 million in fees this financial year, and will continue to provide services for the same amount next financial year Management Service Fees | Item | Amount (RMB million) | | :--- | :--- | | FY2024/25 Management Service Fees | 0.4 | | FY2025/26 Estimated Management Service Fees | 0.4 | [(e) Salaries and Retirement Scheme Contributions Paid to Mr. Chew Han Wei](index=32&type=section&id=(e)%20Salaries%20and%20Retirement%20Scheme%20Contributions%20Paid%20to%20Mr.%20Chew%20Han%20Wei) Mr. Chew Han Wei, son of Chairman and Executive Director Mr. Chew Hua Seng, received remuneration of approximately RMB 1.02 million in this financial year Mr. Chew Han Wei's Remuneration | Item | Amount (RMB million) | | :--- | :--- | | FY2024/25 Remuneration | 1.02 | Other Financial and Corporate Information [Pledge of the Group's Assets](index=33&type=section&id=9.%20Pledge%20of%20the%20Group's%20Assets) As of June 30, 2025, the Group's investment properties of RMB 1,249,969 thousand, bank deposits of RMB 8,967 thousand, and rental income from Swiss hotel properties have been pledged to banks as collateral for bank financing Pledged Asset Values | Pledged Asset | June 30, 2025 (RMB thousand) | June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Investment Properties | 1,249,969 | 1,109,543 | | Bank Deposits | 8,967 | 7,973 | - Rental income from Swiss hotel properties has also been pledged as security for bank borrowings[83](index=83&type=chunk) [Capital Structure](index=33&type=section&id=10.%20Capital%20Structure) As of June 30, 2025, the Group's capital structure remained unchanged compared to the same period last year - The Group's capital structure as of June 30, 2025, remained unchanged compared to June 30, 2024[84](index=84&type=chunk) [Contingent Liabilities](index=33&type=section&id=11.%20Contingent%20Liabilities) As of June 30, 2025, the Group had no contingent liabilities - As of June 30, 2025, the Group had no contingent liabilities[85](index=85&type=chunk) [Use of Proceeds from Property Disposal](index=33&type=section&id=12.%20Use%20of%20Proceeds%20from%20Property%20Disposal) The net proceeds from the disposal of four land use rights in the Oriental University City campus for RMB 110 million were fully utilized as planned by June 30, 2025, primarily for loan repayment and general working capital - Net proceeds from property disposal amounted to **RMB 91.39 million** and were fully utilized as planned by June 30, 2025[87](index=87&type=chunk) Use of Proceeds from Property Disposal | Purpose | Planned Use (RMB million) | Utilized (RMB million) | | :--- | :--- | :--- | | Loan Repayment | 62.00 | 62.00 | | General Working Capital | 29.39 | 29.39 | | **Total** | **91.39** | **91.39** | [Events After Reporting Period](index=34&type=section&id=13.%20Events%20After%20Reporting%20Period) After the reporting period, the Group further disposed of an investment property in July 2025 for RMB 18.00 million, expected to be completed in September 2025. Additionally, the second installment of the termination payment for the terminated purchase of Mongolian investment property has been partially received - On July 4, 2025, the Group entered into a sale and purchase agreement to dispose of a land use right and buildings in the Oriental University City campus for **RMB 18.00 million**, expected to be completed in September 2025[89](index=89&type=chunk) - The termination payment of **RMB 33,690,000** for the terminated purchase of Mongolian investment property will be paid in four installments. As of the announcement date, the first installment of **RMB 8,422,000** has been received, and **RMB 7,554,400** of the second installment of **RMB 8,422,000** has been received, with the balance expected by the end of August 2025[90](index=90&type=chunk) [Employees and Remuneration Policy](index=35&type=section&id=14.%20Employees%20and%20Remuneration%20Policy) As of June 30, 2025, the Group had 38 full-time employees, with total employee costs of approximately RMB 6.66 million. Remuneration policy refers to market salaries and performance, providing training and mandatory social security/provident fund contributions. The share option scheme expired on January 15, 2025, with no options granted, exercised, cancelled, or lapsed during the period Employee and Remuneration Data | Indicator | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Number of Full-Time Employees | 38 | 37 | | Total Employee Costs (RMB million) | 6.66 | 5.46 | - Employee remuneration is determined with reference to market salaries for employees with relevant experience and their respective performance, and training and mandatory social security and provident fund contributions are provided[91](index=91&type=chunk) - The share option scheme expired on January 15, 2025, and no share options have been granted, exercised, cancelled, or lapsed since the listing date[91](index=91&type=chunk) [Final Dividend](index=35&type=section&id=15.%20Final%20Dividend) The Board resolved not to recommend the payment of any dividend for the financial year 2024/25 - The Board resolved not to recommend the payment of any dividend for FY2024/25 (FY2023/24: nil)[92](index=92&type=chunk) Shareholders' and Directors' Interests [Competing Interests](index=36&type=section&id=16.%20Competing%20Interests) Controlling shareholder Raffles confirmed it is not involved in businesses competing with the Group, except for disclosed excluded businesses. Directors also confirmed no interests in any competing businesses as of June 30, 2025 - Controlling shareholder Raffles confirmed that, other than its equity interest in the Company, it is not involved in any business that competes or is likely to compete, directly or indirectly, with the Group's business, nor does it hold any interest in such businesses (except as disclosed in the prospectus)[93](index=93&type=chunk) - The Directors confirmed that as of June 30, 2025, no Director, controlling shareholder or substantial shareholder of the Company, or director of any subsidiary of the Company or any of their respective close associates had any interest in any business that competes or is likely to compete, directly or indirectly, with the Group's business[93](index=93&type=chunk) [Directors' and Chief Executive's Interests and Short Positions in Shares, Underlying Shares, and Debentures](index=38&type=section&id=22.%20Directors'%20and%20Chief%20Executive's%20Interests%20and%20Short%20Positions%20in%20Shares,%20Underlying%20Shares,%20and%20Debentures) As of June 30, 2025, Chairman and Executive Director Mr. Chew Hua Seng held a 75% long position in the Company's shares through a controlled corporation, Raffles. Mr. Chew and his spouse also held interests in Raffles' shares and debentures Directors' Long Positions in the Company's Shares | Director Name | Capacity/Nature of Interest | Number of Issued Shares Held | Percentage of Shareholding | | :--- | :--- | :--- | :--- | | Mr. Chew Hua Seng | Interest of controlled corporation/Corporate interest | 135,000,000 | 75% | - Mr. Chew Hua Seng and his spouse, Ms. Doris Chung Gim Lian, held a **37.89%** interest in the shares of Raffles, an associated corporation of the Company, and held convertible and non-convertible debentures of Raffles[101](index=101&type=chunk)[102](index=102&type=chunk) - Save as disclosed above, no other Director or chief executive of the Company had any other interests or short positions in the shares, underlying shares, and debentures of the Company or any of its associated corporations required to be recorded[103](index=103&type=chunk) [Substantial Shareholders' and Other Persons' Interests and Short Positions in Shares and Underlying Shares](index=40&type=section&id=23.%20Substantial%20Shareholders'%20and%20Other%20Persons'%20Interests%20and%20Short%20Positions%20in%20Shares%20and%20Underlying%20Shares) As of June 30, 2025, Raffles, as beneficial owner, held a 75% long position in the Company's shares. Ms. Chung, spouse of Mr. Chew Hua Seng, was also deemed to have an interest in the same proportion Substantial Shareholders' Long Positions in Shares | Shareholder Name/Name | Capacity/Nature of Interest | Number of Issued Shares Held | Percentage of Shareholding | | :--- | :--- | :--- | :--- | | Raffles | Beneficial owner/Personal interest | 135,000,000 | 75% | | Ms. Chung | Spouse's interest/Family interest | 135,000,000 | 75% | - Raffles is owned **25.01%** by Chairman and Executive Director Mr. Chew, **10.43%** jointly by Mr. Chew and his spouse Ms. Chung, and **2.45%** by Ms. Chung. Under the SFO, Mr. Chew and Ms. Chung are deemed to be interested in the shares in which Raffles has an interest[104](index=104&type=chunk) [Directors' Interests in Transactions, Arrangements or Contracts](index=41&type=section&id=24.%20Directors'%20Interests%20in%20Transactions,%20Arrangements%20or%20Contracts) Except as disclosed, no Director had a material interest, directly or indirectly, in any transaction, arrangement, or contract significant to the Group's business during this financial year - Save as otherwise disclosed, no Director had a material interest, directly or indirectly, in any transaction, arrangement, or contract entered into by the Company or its holding company or any of its subsidiaries or fellow subsidiaries that was significant to the Group's business during FY2024/25[106](index=106&type=chunk) Corporate Governance and Compliance [Annual General Meeting ('2025 AGM')](index=36&type=section&id=17.%20Annual%20General%20Meeting%20(%222025%20AGM%22)) The 2025 AGM will be held on Friday, October 24, 2025, with relevant notice and documents to be dispatched and published as required by the GEM Listing Rules - The 2025 AGM will be held on Friday, October 24, 2025, and the notice and documents will be dispatched and transmitted to shareholders and published on the HKEXnews website and the Company's website in due course as required by the GEM Listing Rules[94](index=94&type=chunk) [Dates for Closure of Register of Members](index=37&type=section&id=18.%20Dates%20for%20Closure%20of%20Register%20of%20Members) To determine eligibility to attend and vote at the 2025 AGM, the Company will suspend its register of members from October 21 to October 24, 2025 Dates for Closure of Register of Members | Item | Date | | :--- | :--- | | Latest Time for Lodging Transfer Documents | 4:30 p.m. on Monday, October 20, 2025 | | Suspension of Register of Members | Tuesday, October 21, 2025, to Friday, October 24, 2025 | | Record Date | Friday, October 24, 2025 | - Unregistered shareholders must deposit all duly completed and stamped transfer forms with the relevant share certificates to the Company's share registrar by the specified deadline[95](index=95&type=chunk) [Corporate Governance](index=37&type=section&id=19.%20Corporate%20Governance) The Company is committed to its shareholder responsibilities and complied with the code provisions of the Corporate Governance Code in Appendix C1 of the GEM Listing Rules during FY2024/25 - The Company is committed to fulfilling its responsibilities to its shareholders, striving to protect and enhance shareholder value through sound corporate governance[96](index=96&type=chunk) - For FY2024/25, the Company complied with the code provisions set out in the section 'Part 2 – Principles of Good Corporate Governance, Code Provisions and Recommended Best Practices' of the Corporate Governance Code in Appendix C1 to the GEM Listing Rules[96](index=96&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=37&type=section&id=20.%20Purchase,%20Sale%20or%20Redemption%20of%20the%20Company's%20Listed%20Securities) During this financial year, neither the Company nor its subsidiaries purchased, sold, or redeemed any GEM-listed securities, nor did they hold any treasury shares - During FY2024/25, the Company did not redeem any of its shares listed on GEM, nor did the Company or any of its subsidiaries purchase or sell any such shares[97](index=97&type=chunk) - As of June 30, 2025, the Company did not hold any treasury shares[98](index=98&type=chunk) [Directors' Securities Transactions](index=38&type=section&id=21.%20Directors'%20Securities%20Transactions) The Company adopted the required standard of dealings under the GEM Listing Rules as the code of conduct for Directors' securities transactions, and all Directors confirmed compliance during this financial year - The Company adopted the required standard of dealings for Directors' securities transactions as set out in Rules 5.48 to 5.67 of the GEM Listing Rules as the code of conduct for Directors' dealings in the Company's securities[99](index=99&type=chunk) - The Company made specific enquiries to all Directors, and each of them confirmed compliance with the required standard of dealings during FY2024/25[99](index=99&type=chunk) [Disclosure under Section 436 of the Companies Ordinance](index=41&type=section&id=25.%20Disclosure%20under%20Section%20436%20of%20the%20Companies%20Ordinance) The financial information in this preliminary results announcement is extracted from the statutory annual consolidated financial statements. The Company has submitted its consolidated financial statements for FY2023/24 as required and will submit those for FY2024/25 in due course. The independent auditor's report contained no qualified opinion - The financial information for FY2024/25 and FY2023/24 contained in this preliminary results announcement does not constitute the Company's statutory annual consolidated financial statements for those years but is extracted from them[107](index=107&type=chunk) - The Company's independent auditor has reported on the Group's consolidated financial statements for both years, and the independent auditor's report contained no qualified opinion[107](index=107&type=chunk) [Review by Audit Committee](index=42&type=section&id=26.%20Review%20by%20Audit%20Committee) The Audit Committee reviewed the Group's adopted accounting principles and practices, as well as the audited annual results for FY2024/25, deeming them compliant with applicable accounting standards and GEM Listing Rules - The Audit Committee comprises three independent non-executive Directors, with Mr. Chan Yiu Cheung as Chairman[108](index=108&type=chunk) - The Audit Committee reviewed the Group's adopted accounting principles and practices, as well as the Group's audited annual results for FY2024/25, and considered them to be prepared in accordance with applicable accounting standards and the GEM Listing Rules, with adequate disclosures made[108](index=108&type=chunk) [Scope of Work of BDO Limited, Hong Kong](index=42&type=section&id=27.%20Scope%20of%20Work%20of%20BDO%20Limited,%20Hong%20Kong) The Company's auditor, BDO Limited, Hong Kong, agreed that the financial figures in the preliminary announcement align with the audited consolidated financial statements, but their work does not constitute an assurance engagement, thus no opinion or assurance conclusion is expressed on the preliminary announcement - The Company's auditor, BDO Limited, Hong Kong, agreed that the figures for the Group's consolidated statement of financial position, consolidated statement of profit or loss and other comprehensive income, and their related notes for FY2024/25 contained in the preliminary announcement are consistent with the amounts in the Group's audited consolidated financial statements for the year[109](index=109&type=chunk) - The work performed by the auditor does not constitute an assurance engagement in accordance with Hong Kong Standards on Auditing, Hong Kong Standards on Review Engagements or Hong Kong Standards on Assurance Engagements issued by the Hong Kong Institute of Certified Public Accountants, and accordingly, no opinion or assurance conclusion is expressed on the preliminary announcement[109](index=109&type=chunk)

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告之內 容 概 不 負 責，對 其 準 確 性 或 完 整 性 亦 不 發 表 任 何 聲 明，並 明 確 表 示 概 不 就因本公告全部或任何部分內容而產生或因倚賴該等內容而引致之任 何 損 失 承 擔 任 何 責 任。 DONGFENG MOTOR GROUP COMPANY LIMITED* 東風汽車集團股份有限公司 （於中華人民共和國註冊成立的股份有限公司） （股份代號：489） 二零二五中期業績公告 東 風 汽 車 集 團 股 份 有 限 公 司（「本公司」）董 事（「董 事」）會（「董事會」）欣 然 宣 佈 本 公 司 及 其 附 屬 公 司（「本集團」或「東風汽車集團」）截 至 二 零 二 五 年 六月三十日止六個月的未經審計綜合業績及二零二四年同期的比較數字。 二零二五年中期財務資料已由本公司審計與風險管理委員會審閱以及 由 本 公 司 核 數 師，安 永 會 計 師 事 務 所 按 照 香 港 會 計 師 公 會 頒 佈 的《香 港 審 閱 準 則》第2410號–「由 實 體 的 獨 立 核 數 師 執 行 中 期 財 務 資 料 審 閱 ...

[Announcement Summary](index=1&type=section&id=%E5%85%AC%E5%91%8A%E6%91%98%E8%A6%81) [Financial Highlights](index=1&type=section&id=%E8%B2%A1%E5%8B%99%E6%91%98%E8%A6%81) The Group's financial results for the six months ended June 30, 2025, show a 23.2% year-on-year increase in revenue, but a decline in gross profit, profit for the period, and adjusted net profit, with the Board resolving to declare an interim dividend of 3.5 HK cents per share Financial Highlights for H1 2025 | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 918.7 | 745.4 | 23.2% | | Gross Profit | 94.4 | 117.3 | -19.5% | | Profit for the Period | 19.3 | 29.9 | -35.6% | | Adjusted Net Profit | 22.2 | 56.6 | -60.8% | | Basic Earnings Per Share | RMB 0.04 | RMB 0.08 | -50.0% | | Diluted Earnings Per Share | RMB 0.04 | RMB 0.08 | -50.0% | - The Board resolved to declare an interim dividend of **3.5 HK cents per ordinary share** for the six months ended June 30, 2025[4](index=4&type=chunk) [Interim Condensed Consolidated Financial Statements](index=2&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8) [Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=2&type=section&id=%E4%B8%AD%E6%9C%9F%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 consolidated statement of profit or loss for the six months ended June 30, 2025, shows a 23.2% revenue growth, but a 19.5% decrease in gross profit and a 35.6% year-on-year reduction in profit for the period, driven by a significant 31.2% increase in cost of sales and a 360.6% surge in finance costs Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income for the Six Months Ended June 30, 2025 | Metric | 2025 (RMB thousand) | 2024 (RMB thousand) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 918,661 | 745,396 | 23.2% | | Cost of Sales | (824,306) | (628,142) | 31.2% | | Gross Profit | 94,355 | 117,254 | -19.5% | | Other Income and Gains | 14,328 | 6,504 | 120.3% | | Finance Costs | (26,570) | (5,769) | 360.6% | | Profit for the Period | 19,303 | 29,958 | -35.6% | | Total Comprehensive Income for the Period | 18,831 | 29,719 | -36.6% | | Basic Earnings Per Share | RMB 0.04 | RMB 0.08 | -50.0% | [Interim Condensed Consolidated Statement of Financial Position](index=4&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) As of June 30, 2025, the Group's total non-current and current assets increased, alongside significant rises in current and non-current liabilities, particularly lease liabilities, while total equity slightly decreased, maintaining a healthy current ratio of 1.5 Interim Condensed Consolidated Statement of Financial Position as of June 30, 2025 | Metric | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Total Non-current Assets | 1,202,644 | 1,053,100 | 14.2% | | Total Current Assets | 732,219 | 652,226 | 12.3% | | Total Current Liabilities | 499,440 | 423,874 | 17.8% | | Total Non-current Liabilities | 847,759 | 685,241 | 23.7% | | Total Equity | 587,664 | 596,211 | -1.4% | | Net Current Assets | 232,779 | 228,352 | 1.9% | - As of June 30, 2025, the Group's current ratio was **1.5**, consistent with December 31, 2024[73](index=73&type=chunk) [Notes to the Financial Statements](index=6&type=section&id=Notes%20to%20the%20Financial%20Statements) [Basis of Preparation](index=6&type=section&id=%E7%B7%A8%E8%A3%BD%E5%9F%BA%E7%A4%8E) These interim condensed consolidated financial statements are prepared in accordance with HKAS 34 and should be read in conjunction with the Group's annual consolidated financial statements for the year ended December 31, 2024, presented in RMB - The interim condensed consolidated financial statements are prepared in accordance with **HKAS 34** and presented in **RMB**[11](index=11&type=chunk) [Changes in Accounting Policies and Disclosures](index=6&type=section&id=Changes%20in%20Accounting%20Policies%20and%20Disclosures) The accounting policies adopted for these interim condensed consolidated financial information are consistent with the prior year, except for the initial adoption of revised HKFRSs, with the amendments to HKAS 21 having no impact on the Group - Accounting policies are consistent with the 2024 annual consolidated financial statements, except for the initial adoption of revised **HKFRSs**[12](index=12&type=chunk) - Amendments to **HKAS 21** (Lack of Exchangeability) had no impact on the interim condensed consolidated financial information[13](index=13&type=chunk) [Operating Segment Information](index=6&type=section&id=Operating%20Segment%20Information) The Group primarily provides first-mile international freight and last-mile fulfillment services, with no separate operating segment information presented as the chief operating decision-maker reviews overall financial performance, and revenue and non-current assets are mainly concentrated in the US market - The Group primarily provides **first-mile international freight services** and **last-mile fulfillment services**, including overseas warehousing, value-added services, and delivery for cross-border e-commerce participants in mainland China[14](index=14&type=chunk) - No further information on operating segments is presented as the directors review the Group's overall financial performance[15](index=15&type=chunk) [Geographical Information](index=7&type=section&id=Geographical%20Information) The Group's revenue from external customers is primarily from the US, with significant growth also seen in Canada, the UK, Germany, and Australia, while revenue from China decreased, and non-current assets are also mainly concentrated in the US Revenue from External Customers (by Location of Services Provided) | Region | 2025 (RMB thousand) | 2024 (RMB thousand) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | China | 68,414 | 115,560 | -40.8% | | United States | 647,178 | 516,775 | 25.2% | | Canada | 65,573 | 38,361 | 70.9% | | United Kingdom | 39,516 | 31,635 | 24.9% | | Germany | 81,069 | 37,275 | 117.5% | | Australia | 16,911 | 5,790 | 192.1% | | **Total** | **918,661** | **745,396** | **23.2%** | Non-current Assets (by Location of Assets) | Region | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | China | 107,085 | 180,588 | -40.7% | | United States | 748,389 | 642,284 | 16.5% | | United Kingdom | 85,425 | 20,296 | 320.9% | | Canada | 5,391 | 3,439 | 56.8% | | Germany | 97,141 | 92,189 | 5.4% | | Indonesia | 51,258 | 21,550 | 137.9% | | Australia | 226 | 258 | -12.5% | | **Total** | **1,094,915** | **960,604** | **14.0%** | [Information about Major Customers](index=8&type=section&id=Information%20about%20Major%20Customers) For the six months ended June 30, 2025, no single external customer contributed 10.8% or more to the Group's total revenue, indicating a diversified customer base - For the six months ended June 30, 2025, no revenue from transactions with a single external customer contributed **10.8% or more** to the Group's total revenue[18](index=18&type=chunk) [Revenue, Other Income and Gains](index=9&type=section&id=Revenue%2C%20Other%20Income%20and%20Gains) The Group's total revenue increased by 23.2% year-on-year, primarily driven by strong growth in last-mile fulfillment services revenue, while other income and gains also significantly increased, mainly due to gains from loss of control over a subsidiary and credit card rebates - Revenue from contracts with customers increased by **23.2%** to **RMB 918,661 thousand**[20](index=20&type=chunk) - Other income and gains increased by **120.3%** year-on-year to **RMB 14,328 thousand**, primarily from gains on loss of control over a subsidiary (**RMB 7,714 thousand**) and credit card rebates (**RMB 2,065 thousand**)[23](index=23&type=chunk) [Revenue Analysis](index=9&type=section&id=Revenue%20Analysis) Last-mile fulfillment services revenue grew by 35.0% year-on-year, accounting for 92.6% of total revenue and becoming the primary revenue source, while first-mile international freight services revenue decreased by 40.8% Revenue Breakdown (by Service Type) | Service Type | 2025 (RMB thousand) | 2024 (RMB thousand) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | First-mile International Freight Services | 68,414 | 115,560 | -40.8% | | Last-mile Fulfillment Services | 850,247 | 629,836 | 35.0% | | **Total** | **918,661** | **745,396** | **23.2%** | [Other Income and Gains Analysis](index=10&type=section&id=Other%20Income%20and%20Gains%20Analysis) Other income and gains significantly increased, primarily contributed by gains from loss of control over a subsidiary (RMB 7,714 thousand) and credit card rebates (RMB 2,065 thousand) Details of Other Income and Gains | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Interest Income | 1,175 | 2,416 | -51.3% | | Net Exchange Gain | 238 | 2,089 | -88.6% | | Rebates from Credit Cards | 2,065 | 342 | 503.8% | | Gain on Loss of Control over a Subsidiary | 7,714 | — | N/A | | **Total** | **14,328** | **6,504** | **120.3%** | [Finance Costs](index=10&type=section&id=Finance%20Costs) The Group's finance costs surged by 360.6% year-on-year to RMB 26,570 thousand, primarily due to a substantial increase in interest expenses on lease liabilities Details of Finance Costs | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Interest Expense on Borrowings | 2,733 | 1,075 | 154.2% | | Interest Expense on Lease Liabilities | 23,837 | 4,694 | 407.8% | | **Total** | **26,570** | **5,769** | **360.6%** | [Income Tax Expense](index=11&type=section&id=Income%20Tax%20Expense) The Group's income tax expense significantly decreased by 94.0% to RMB 411 thousand, mainly due to deferred tax reversal, as the Group operates in multiple jurisdictions including Hong Kong, mainland China, the US, UK, Canada, Germany, and Australia, enjoying certain tax incentives - The Group pays income tax in multiple jurisdictions, including Hong Kong, mainland China, the US, UK, Canada, Germany, and Australia, with varying tax rates[26](index=26&type=chunk)[27](index=27&type=chunk)[29](index=29&type=chunk) - Some Chinese subsidiaries enjoy a **15% corporate income tax preferential rate** as high-tech enterprises or within the Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone[28](index=28&type=chunk) [Total Income Tax Expense](index=12&type=section&id=Total%20Income%20Tax%20Expense) Total tax expense for the period significantly decreased, primarily due to a deferred tax reversal from a loss position Details of Total Income Tax Expense | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Current Tax | 8,350 | 7,120 | 17.3% | | Deferred Tax | (7,939) | (254) | -3025.6% | | **Total Tax Expense for the Period** | **411** | **6,866** | **-94.0%** | [Dividends](index=12&type=section&id=%E8%82%A1%E6%81%AF) The Board recommended declaring an interim dividend of 3.5 HK cents per ordinary share for the six months ended June 30, 2025, totaling HKD 15,500,000 - The Board recommended declaring an interim dividend of **3.5 HK cents per ordinary share**, totaling **HKD 15,500,000** (approximately **RMB 14,246,000**)[31](index=31&type=chunk) [Earnings Per Share Attributable to Owners of the Parent](index=13&type=section&id=Earnings%20Per%20Share%20Attributable%20to%20Owners%20of%20the%20Parent) The Group's basic and diluted earnings per share for the six months ended June 30, 2025, were RMB 0.04, a 50% decrease from the prior year, mainly due to reduced profit for the period despite an increase in the weighted average number of ordinary shares outstanding - Basic and diluted earnings per share were both **RMB 0.04** (2024: **RMB 0.08**)[8](index=8&type=chunk)[33](index=33&type=chunk) - The weighted average number of ordinary shares outstanding was **440,569,439** (2024: **360,114,033**)[32](index=32&type=chunk)[35](index=35&type=chunk) [Leases](index=14&type=section&id=Leases) The Group recognized significant additional right-of-use assets and new lease liabilities during the period, primarily for warehouses and offices, leading to a substantial increase in interest expenses on lease liabilities - Total cost of additional right-of-use assets recognized during the period was **RMB 188,628 thousand** (2024: **RMB 108,057 thousand**)[36](index=36&type=chunk) - New lease liabilities of **RMB 188,628 thousand** were recognized during the period (2024: **RMB 108,057 thousand**)[37](index=37&type=chunk) - Interest expenses on lease liabilities increased to **RMB 23,837 thousand** (2024: **RMB 4,694 thousand**)[37](index=37&type=chunk) [Trade Receivables](index=15&type=section&id=Trade%20Receivables) The Group's net trade receivables decreased to RMB 167,819 thousand, with the vast majority (99.5%) due within 3 months, reflecting strict credit risk management and no significant concentration risk Trade Receivables (Net of Impairment) | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Trade Receivables | 179,500 | 214,163 | | Impairment | (11,681) | (16,797) | | **Net Amount** | **167,819** | **197,366** | Ageing Analysis of Trade Receivables | Ageing | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Within 3 months | 167,012 | 194,002 | | 3 to 6 months | 491 | 2,840 | | Over 6 months | 316 | 524 | | **Total** | **167,819** | **197,366** | - Impairment reversal for trade receivables was **RMB 4,377 thousand** during the period[40](index=40&type=chunk) [Trade Payables](index=16&type=section&id=Trade%20Payables) The Group's trade payables decreased to RMB 118,169 thousand, with the vast majority (99.5%) due within 1 year, and these payables are unsecured, interest-free, and typically settled within 30 to 60 days Trade Payables | Item | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Trade Payables | 118,169 | 148,261 | Ageing Analysis of Trade Payables | Ageing | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Within 1 year | 117,534 | 147,491 | | 1 to 2 years | 383 | 282 | | 2 to 3 years | 218 | 1 | | Over 3 years | 34 | 487 | | **Total** | **118,169** | **148,261** | [Treasury Shares](index=17&type=section&id=Treasury%20Shares) The Company purchased 6,313,000 of its shares on the Hong Kong Stock Exchange for a total consideration of HKD 17,413,000 (approximately RMB 16,043,000) for future share-based payment schemes - The Company purchased **6,313,000 shares** as treasury shares for a total consideration of approximately **RMB 16,043,000**, intended for future share-based payment schemes[41](index=41&type=chunk) [Loss of Control over a Subsidiary](index=17&type=section&id=Loss%20of%20Control%20over%20a%20Subsidiary) The Group lost control over PT Flexlogis and its subsidiary PT SAMANEA LOGISTICS PROPERTY due to Beijing Liqian Technology Co., Ltd.'s RMB 83,800,000 capital injection for a 51.16% equity stake in PT Flexlogis, making them a joint venture of the Group and recognizing a gain of RMB 7,714 thousand - Beijing Liqian Technology Co., Ltd. invested **RMB 83,800,000** to acquire a **51.16% equity stake** in PT Flexlogis[42](index=42&type=chunk) - PT Flexlogis and its subsidiary PT SAMANEA LOGISTICS PROPERTY became a **joint venture** of the Group[42](index=42&type=chunk) - A gain of **RMB 7,714 thousand** was recognized from the loss of control over the subsidiary[43](index=43&type=chunk) [Management Discussion and Analysis](index=19&type=section&id=Management%20Discussion%20and%20Analysis) [Business Review](index=19&type=section&id=Business%20Review) As a leading AI logistics technology service group, the Group upgraded its strategic goal to AI-driven in H1 2025, focusing on long-term growth, achieving robust business performance with 23.2% revenue growth, significant increases in core customer numbers and SaaS service revenue, and continuous expansion of its overseas warehouse network and partnerships with e-commerce platforms and technology partners - In February 2025, the Group officially upgraded its long-term strategic goal to become a 'global leading **Artificial Intelligence (AI) logistics technology service group**,' committed to driving the transformation of the cross-border e-commerce logistics industry through AI and large model technologies[47](index=47&type=chunk) - During the period, **5 new self-operated overseas warehouses** were expanded, increasing total area by approximately **110,000 square meters**, with a total of **61 overseas warehouses** contracted as of June 30, 2025[50](index=50&type=chunk) - The number of core customers increased to **109** (73 in the same period of 2024), with core customer sales growing by **17.8%** to **RMB 774,561 thousand**; SaaS service revenue increased to **RMB 1,167 thousand** (2024: **RMB 168 thousand**)[50](index=50&type=chunk) - Achieved comprehensive cooperation with **Huawei Cloud Computing Technology Co., Ltd.** to jointly explore advanced technologies like AI and big data, fully integrated **DeepSeek**, and successfully became a global service case for **Amazon Web Services**[53](index=53&type=chunk)[54](index=54&type=chunk) [Business Outlook and Future Strategies](index=24&type=section&id=Business%20Outlook%20and%20Future%20Strategies) Despite global trade uncertainties, the cross-border e-commerce industry is rapidly growing, highlighting the increasing importance of overseas warehouses, and the Group will leverage its competitive advantages to strengthen supply chain solutions, increase IT and SaaS platform investments, optimize customer structure, and actively seek strategic collaborations and M&A opportunities, fully embracing AI technology for sustainable high-quality growth - In H1 2025, China's cross-border e-commerce import and export volume was approximately **RMB 1.32 trillion**, a year-on-year increase of **5.7%**[56](index=56&type=chunk) - The cancellation of de minimis exemptions for small parcels in the US and Europe will significantly increase tariff costs and customs clearance times, further highlighting the advantage of overseas warehouses for bulk entry through pre-positioned inventory[56](index=56&type=chunk)[57](index=57&type=chunk) - The Group's competitive advantages include continuous investment in **technology and system R&D**, strong **global network organization capabilities**, ability to provide highly specialized and customized **AI logistics technology services**, a high-quality and stable **customer structure**, an expanding **overseas warehouse network**, and deepening cooperation with major e-commerce platforms[60](index=60&type=chunk) - Future strategies include strengthening **supply chain solution capabilities**, increasing investment in **IT infrastructure and SaaS platform development**, optimizing **customer structure**, seeking **strategic partners and quality M&A targets**, and fully embracing **AI and large model technologies**[61](index=61&type=chunk)[62](index=62&type=chunk) [Financial Review](index=27&type=section&id=Financial%20Review) The Group's financial review indicates revenue growth primarily driven by last-mile fulfillment services, but a significant increase in cost of sales, particularly warehouse operating and labor costs, led to a substantial decline in gross profit and gross margin, with first-mile gross margin slightly improving due to lower sea freight prices, while last-mile gross margin decreased due to the profitability cycle of new overseas warehouses and rising costs - Total revenue increased by **23.2%** year-on-year to **RMB 918,661 thousand**, with last-mile fulfillment services revenue growing by **35.0%**[63](index=63&type=chunk) - Cost of sales increased by **31.2%** year-on-year to **RMB 824,306 thousand**, primarily impacted by a **48.5%** increase in last-mile fulfillment services cost of sales[67](index=67&type=chunk) - Gross profit decreased by **19.5%** year-on-year to **RMB 94,355 thousand**, with the overall gross margin declining from **15.7%** to **10.3%**[70](index=70&type=chunk) - The primary reasons for the decline in last-mile gross margin include the time required for newly leased overseas warehouses to become profitable, as well as continuous increases in overseas order prices, overseas warehouse labor costs, and rental costs[71](index=71&type=chunk) [Revenue](index=27&type=section&id=Revenue) The Group's revenue growth was primarily driven by the strong performance of last-mile fulfillment services, while first-mile international freight services revenue decreased due to reduced sea freight container volume and the termination of air freight small parcel direct mail business - Last-mile fulfillment services revenue increased by **35.0%** year-on-year to **RMB 850,247 thousand**, primarily benefiting from an increase in last-mile order volume[63](index=63&type=chunk) - First-mile international freight services revenue decreased by **40.8%** year-on-year to **RMB 68,414 thousand**, mainly affected by reduced sea freight container volume and lower international shipping rates, with the air freight small parcel direct mail business having been terminated[63](index=63&type=chunk) [By Service Category](index=28&type=section&id=By%20Service%20Category) The proportion of last-mile fulfillment services in total revenue increased from 84.5% to 92.6%, while that of first-mile international freight services decreased from 15.5% to 7.4% Revenue (by Service Category) | Service Category | 2025 (RMB thousand) | Proportion (%) | 2024 (RMB thousand) | Proportion (%) | | :--- | :--- | :--- | :--- | :--- | | First-mile International Freight Services | 68,414 | 7.4 | 115,560 | 15.5 | | Last-mile Fulfillment Services | 850,247 | 92.6 | 629,836 | 84.5 | | **Total** | **918,661** | **100.0** | **745,396** | **100.0** | Service Volume (by Service Category) | Service Category | 2025 Sea Freight Volume (TEUs) | 2025 Last-Mile Orders (million) | 2024 Sea Freight Volume (TEUs) | 2024 Air Freight Volume (tons) | 2024 Last-Mile Orders (million) | | :--- | :--- | :--- | :--- | :--- | :--- | | First-mile International Freight Services | 2,509 | Not Applicable | 2,956 | 336 | Not Applicable | | Last-mile Fulfillment Services | Not Applicable | 6.5 | Not Applicable | Not Applicable | 3.8 | [By Country](index=28&type=section&id=By%20Country) Revenue from the United States, Canada, and Germany significantly increased, reflecting the Group's continued investment in overseas warehouses and increased sales channel efforts in these regions Revenue (by Country) | Country | 2025 (RMB thousand) | Proportion (%) | 2024 (RMB thousand) | Proportion (%) | | :--- | :--- | :--- | :--- | | United States | 703,782 | 76.6 | 622,375 | 83.5 | | Canada | 69,896 | 7.6 | 40,621 | 5.4 | | United Kingdom | 44,163 | 4.8 | 36,267 | 4.9 | | Germany | 83,260 | 9.1 | 40,135 | 5.4 | | Australia | 17,560 | 1.9 | 5,998 | 0.8 | | **Total** | **918,661** | **100.0** | **745,396** | **100.0** | [Cost of Sales](index=29&type=section&id=Cost%20of%20Sales) The Group's cost of sales increased by 31.2% year-on-year, primarily driven by a substantial 48.5% increase in last-mile fulfillment services cost of sales, with warehouse operating costs and labor costs being the main growth factors - Cost of sales increased by **31.2%** year-on-year to **RMB 824,306 thousand**[67](index=67&type=chunk) - Cost of sales for last-mile fulfillment services increased by **48.5%** to **RMB 759,017 thousand**[67](index=67&type=chunk) [By Service Category](index=29&type=section&id=By%20Service%20Category) The proportion of last-mile fulfillment services in total cost of sales increased from 81.4% to 92.1%, consistent with the change in revenue structure Cost of Sales (by Service Category) | Service Category | 2025 (RMB thousand) | Proportion (%) | 2024 (RMB thousand) | Proportion (%) | | :--- | :--- | :--- | :--- | :--- | | First-mile International Freight Services | 65,289 | 7.9 | 116,877 | 18.6 | | Last-mile Fulfillment Services | 759,017 | 92.1 | 511,265 | 81.4 | | **Total** | **824,306** | **100.0** | **628,142** | **100.0** | [By Cost Element](index=29&type=section&id=By%20Cost%20Element) Warehouse operating costs and labor costs increased by 84.9% and 56.5% respectively, serving as the primary drivers of cost of sales growth, reflecting increased overseas warehouse expansion and personnel investment Cost of Sales (by Cost Element) | Cost Element | 2025 (RMB thousand) | Proportion (%) | 2024 (RMB thousand) | Proportion (%) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Logistics Costs | 520,650 | 63.2 | 450,402 | 71.7 | 15.6% | | Warehouse Operating Costs | 168,105 | 20.3 | 90,925 | 14.4 | 84.9% | | Labor Costs | 135,303 | 16.4 | 86,442 | 13.8 | 56.5% | | Share-based Payment Expenses | 248 | 0.1 | 373 | 0.1 | -33.5% | | **Total** | **824,306** | **100.0** | **628,142** | **100.0** | **31.2%** | [Gross Profit and Gross Margin](index=30&type=section&id=Gross%20Profit%20and%20Gross%20Margin) The Group's gross profit decreased by 19.5%, with the overall gross margin falling to 10.3%; last-mile gross margin declined due to the profitability cycle of new overseas warehouses and rising costs, while first-mile gross margin slightly improved due to lower sea freight prices Gross Profit and Gross Margin (by Service Category) | Service Category | 2025 Gross Profit (RMB thousand) | 2025 Gross Margin (%) | 2024 Gross Profit (RMB thousand) | 2024 Gross Margin (%) | | :--- | :--- | :--- | :--- | :--- | | First-mile International Freight Services | 3,125 | 4.6% | (1,317) | (1.1%) | | Last-mile Fulfillment Services | 91,230 | 10.7% | 118,571 | 18.8% | | **Total** | **94,355** | **10.3%** | **117,254** | **15.7%** | - The primary reasons for the decline in last-mile gross margin include the time required for newly leased overseas warehouses to become profitable, as well as continuous increases in overseas order prices, overseas warehouse labor costs, and rental costs[71](index=71&type=chunk) - First-mile gross margin slightly increased, primarily due to the continuous decline in first-mile sea freight prices since the second quarter[70](index=70&type=chunk) [Financial Position](index=31&type=section&id=Financial%20Position) The Group maintains a prudent financial policy with a healthy debt-to-asset ratio of 34% and a current ratio of 1.5; despite a slight decrease in total equity, the Board believes the Group has sufficient working capital for operations and future development - The Group's total debt (borrowings and lease liabilities) was **RMB 1,119,650 thousand**, with a debt-to-asset ratio of **34%**[73](index=73&type=chunk) - Total equity decreased from **RMB 596,211 thousand** as of December 31, 2024, to **RMB 587,664 thousand** as of June 30, 2025[73](index=73&type=chunk) - The current ratio was **1.5**, with cash and bank balances of **RMB 301,131 thousand**, and the Board considers working capital to be sufficient[73](index=73&type=chunk) [Contingent Liabilities](index=32&type=section&id=Contingent%20Liabilities) As of the end of the relevant period, the Group had no significant contingent liabilities - As of the end of the relevant period, the Group had no significant contingent liabilities[75](index=75&type=chunk) [Human Resources](index=32&type=section&id=Human%20Resources) The Group has 397 employees with total staff costs of RMB 170,436 thousand, operating a performance-based remuneration system and various share incentive schemes to motivate employees - The Group has **397 employees**, with total staff costs of **RMB 170,436 thousand**[76](index=76&type=chunk) - The Company has adopted various share option schemes and share award schemes to incentivize eligible participants who contribute to the Group[76](index=76&type=chunk) [Other Information](index=32&type=section&id=Other%20Information) The Group undertook several strategic investments and transactions during the period, including new overseas warehouse leases, short-term financial investments, plans to establish two funds for cross-border e-commerce and AI logistics, a gain recognized from the loss of control over PT Flexlogis due to equity changes, and a connected transaction to acquire an Indonesian logistics real estate company - During the period, **5 new overseas warehouses** were leased, increasing total area by approximately **110,000 square meters**, located in the US, Canada, and the UK respectively[77](index=77&type=chunk) - Held short-term financial investments of approximately **RMB 49,278 thousand**, primarily money market funds and guaranteed structured notes, with **unrealized investment losses of approximately RMB 3,230 thousand** and **realized investment gains of approximately RMB 719 thousand** recognized during the period[78](index=78&type=chunk) - Plans to establish two funds with a total size of **RMB 200 million**, with the Group proposing to subscribe for no more than **RMB 100 million**, primarily investing in cross-border e-commerce innovation industries, overseas warehousing facilities, and AI technology fields[81](index=81&type=chunk) - Due to capital injection by Beijing Liqian Technology Co., Ltd., the Company lost control over PT Flexlogis Investment Indonesia, making it a joint venture, and recognized a gain of **RMB 7,714 thousand**[83](index=83&type=chunk)[84](index=84&type=chunk) - Acquired all issued shares of PT Samanea Logistics Property, a company specializing in Indonesian logistics real estate investment and property management, through a connected transaction for a total consideration of approximately **RMB 6,179,146**[86](index=86&type=chunk)[87](index=87&type=chunk) [Corporate Governance and Others](index=35&type=section&id=Corporate%20Governance%20and%20Others) [Audit Committee](index=35&type=section&id=Audit%20Committee) The Company's Audit Committee has reviewed the Group's accounting policies and the unaudited condensed consolidated financial statements, which were also reviewed by independent auditor Ernst & Young - The Audit Committee has reviewed the Group's accounting policies and the unaudited condensed consolidated financial statements[91](index=91&type=chunk) - The condensed consolidated financial statements have been reviewed by **Ernst & Young** in accordance with Hong Kong Standard on Review Engagements 2410[91](index=91&type=chunk) [Corporate Governance Practices](index=36&type=section&id=Corporate%20Governance%20Practices) The Group is committed to maintaining high standards of corporate governance and has complied with all applicable code provisions of the Corporate Governance Code set out in Appendix C1 Part 2 of the Listing Rules during the relevant period - The Group is committed to maintaining high standards of corporate governance and has complied with all applicable code provisions of the Corporate Governance Code[93](index=93&type=chunk) [Standard Code for Securities Transactions by Directors](index=36&type=section&id=Standard%20Code%20for%20Securities%20Transactions%20by%20Directors) The Company has adopted the Model Code set out in Appendix C3 of the Listing Rules, and all directors confirmed compliance with it during the relevant period - The Company has adopted the Model Code set out in Appendix C3 of the Listing Rules, and all directors confirmed compliance with it[94](index=94&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=37&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company%27s%20Listed%20Securities) Except for the trustee of the share award scheme purchasing 6,313,000 shares of the Company, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any listed securities during the relevant period - Except for the trustee of the share award scheme purchasing **6,313,000 shares** of the Company, neither the Company nor its subsidiaries purchased, sold, or redeemed any listed securities[95](index=95&type=chunk) [Changes in Board Composition](index=37&type=section&id=Changes%20in%20Board%20Composition) No changes in the Company's Board composition requiring disclosure under Rule 13.51B(1) of the Listing Rules occurred during the relevant period - During the relevant period, there were no changes in the Company's directors' information requiring disclosure under Rule 13.51B(1) of the Listing Rules[96](index=96&type=chunk) [Use of Proceeds from Global Offering](index=37&type=section&id=Use%20of%20Proceeds%20from%20Global%20Offering) The net proceeds from the global offering were approximately HKD 161.3 million, of which HKD 117.9 million had been utilized as of June 30, 2025, primarily for enhancing the global logistics network Use of Proceeds from Global Offering and Utilization | Purpose | Expected Utilization (%) | Expected Amount (HKD million) | Amount Utilized as of June 30, 2025 (HKD million) | Balance (HKD million) | | :--- | :--- | :--- | :--- | :--- | | Enhance Global Logistics Network | 62% | 100.0 | 91.4 | 8.6 | | Improve Smart Systems | 16% | 25.8 | 6.3 | 19.5 | | Attract New Customers and Maintain Relationships | 16% | 25.8 | 10.5 | 15.3 | | General Working Capital | 6% | 9.7 | 9.7 | — | | **Total** | **100%** | **161.3** | **117.9** | **43.4** | [Interim Dividend](index=38&type=section&id=Interim%20Dividend) The Board resolved to declare an interim dividend of 3.5 HK cents per share for the six months ended June 30, 2025, expected to be distributed on or about October 31, 2025 - The Board resolved to declare an interim dividend of **3.5 HK cents per share** for the six months ended June 30, 2025[98](index=98&type=chunk) - The distribution to shareholders entitled to the dividend is expected on or about **Friday, October 31, 2025**[98](index=98&type=chunk) [Closure of Register of Members](index=38&type=section&id=Closure%20of%20Register%20of%20Members) To determine eligibility for the interim dividend, the Company's register of members will be closed from October 3, 2025, to October 7, 2025 - The Company's register of members will be closed from **Friday, October 3, 2025, to Tuesday, October 7, 2025**[99](index=99&type=chunk) - To qualify for the interim dividend, all share transfer documents must be lodged for registration no later than **4:30 p.m. on Thursday, October 2, 2025**[99](index=99&type=chunk) [Events After the Reporting Period](index=38&type=section&id=Events%20After%20the%20Reporting%20Period) No significant events occurred after the reporting period and up to the date of this announcement - No significant events occurred after the reporting period and up to the date of this announcement[100](index=100&type=chunk) [Publication of Results Announcement and Interim Report](index=38&type=section&id=Publication%20of%20Results%20Announcement%20and%20Interim%20Report) This announcement has been published on the HKEX and Company websites, and the interim report will be dispatched to shareholders and published on the aforementioned websites in due course - This announcement is published on the HKEX website (www.hkex.com.hk) and the Company's website (www.edayun.com)[101](index=101&type=chunk) - The Company's interim report for the six months ended June 30, 2025, will be dispatched to shareholders and published on the aforementioned websites in due course[101](index=101&type=chunk) [Appendix](index=39&type=section&id=Appendix) [Definitions](index=39&type=section&id=Definitions) This section provides definitions for key terms used in the announcement to ensure readers have a clear understanding of the report's content - Provides definitions for key terms used in the announcement, such as 'Board,' 'B2C,' 'China,' 'Company,' and 'Current Ratio'[105](index=105&type=chunk) [Forward-Looking Statements](index=40&type=section&id=Forward-Looking%20Statements) This announcement contains forward-looking statements based on the current beliefs, assumptions, expectations, estimates, and projections of the directors and management, which are not historical facts - The announcement contains forward-looking statements, including but not limited to statements regarding revenue and profit[107](index=107&type=chunk) - Forward-looking statements are based on the current beliefs, assumptions, expectations, estimates, and projections of the Company's directors and management regarding its business, industry, and markets in which it operates, and are not historical facts[107](index=107&type=chunk)

[Interim Results Announcement](index=1&type=section&id=Interim%20Results%20Announcement) This section presents the key financial performance, profit or loss, comprehensive income, and financial position for the six months ended June 30, 2025 [Financial Highlights](index=1&type=section&id=Financial%20Highlights) This section outlines the company's key financial performance for the six months ended June 30, 2025, including revenue growth, decreased gross profit, significant reductions in profit before tax and profit for the period, and a notable decline in earnings per share | Metric | 2025 (thousand RMB) | 2024 (thousand RMB) | Change | | :--- | :--- | :--- | :--- | | Revenue | 630,424 | 577,447 | 9.2% | | Gross Profit | 313,978 | 337,912 | -7.1% | | Gross Profit Margin | 49.8% | 58.5% | -8.7 percentage points | | Profit Before Tax | 130,317 | 556,752 | -76.6% | | Profit for the Period | 101,708 | 491,583 | -79.3% | | Net Profit Margin | 16.1% | 85.1% | -69.0 percentage points | | Profit Attributable to Owners of the Parent (excluding 2024 non-recurring profit) | 104,572 | 126,127 | -17.1% | | Basic Earnings Per Share | 0.06961 | 0.3286 | -78.8% | [Condensed Consolidated Statement of Profit or Loss](index=2&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss) This section presents the group's condensed consolidated statement of profit or loss for the six months ended June 30, 2025, detailing revenue, cost of sales, gross profit, other income and gains, various expenses, finance costs, share of loss of associates, profit before tax, income tax, and profit for the period, allocated to owners of the parent and non-controlling interests | Metric | 2025 (thousand RMB) | 2024 (thousand RMB) | | :--- | :--- | :--- | | Revenue | 630,424 | 577,447 | | Cost of Sales | (316,446) | (239,535) | | Gross Profit | 313,978 | 337,912 | | Other Income and Gains | 30,861 | 421,636 | | Selling and Distribution Expenses | (56,830) | (68,911) | | Administrative Expenses | (67,491) | (54,148) | | Research and Development Costs | (56,816) | (43,883) | | Other Expenses | (33,071) | (29,498) | | Finance Costs | (314) | (2,660) | | Profit Before Tax | 130,317 | 556,752 | | Income Tax | (28,609) | (65,169) | | Profit for the Period | 101,708 | 491,583 | | Profit Attributable to Owners of the Parent | 104,572 | 493,046 | | Profit Attributable to Non-controlling Interests | (2,864) | (1,463) | | Basic Earnings Per Share | RMB 0.06961 | RMB 0.3286 | [Condensed Consolidated Statement of Comprehensive Income](index=3&type=section&id=Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) This section discloses the group's condensed consolidated statement of comprehensive income for the six months ended June 30, 2025, showing profit for the period and other comprehensive (loss)/income, primarily from exchange differences on translation of foreign operations and the company's financial statements, leading to the total comprehensive income for the period after tax | Metric | 2025 (thousand RMB) | 2024 (thousand RMB) | | :--- | :--- | :--- | | Profit for the Period | 101,708 | 491,583 | | Exchange Differences Arising from Translation of Foreign Operations | (4,848) | 2,516 | | Exchange Differences Arising from Translation of the Company's Financial Statements | (10,350) | 8,473 | | Total Other Comprehensive (Loss)/Income for the Period After Tax | (15,198) | 10,989 | | Total Comprehensive Income for the Period After Tax | 86,510 | 502,572 | | Attributable to Owners of the Parent | 89,374 | 504,035 | | Attributable to Non-controlling Interests | (2,864) | (1,463) | [Condensed Consolidated Statement of Financial Position](index=4&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) This section provides the group's condensed consolidated statement of financial position as of June 30, 2025, and December 31, 2024, detailing non-current assets, current assets, current liabilities, non-current liabilities, and total equity, reflecting the composition and period-end changes in assets, liabilities, and shareholders' equity | Metric | June 30, 2025 (thousand RMB) | December 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Total Non-current Assets | 1,748,101 | 1,807,035 | | Total Current Assets | 2,134,581 | 2,202,241 | | Total Current Liabilities | 446,960 | 554,603 | | Net Current Assets | 1,687,621 | 1,647,638 | | Total Non-current Liabilities | 132,726 | 128,005 | | Net Assets | 3,302,996 | 3,326,668 | | Total Equity | 3,302,996 | 3,326,668 | [Notes to the Financial Statements](index=6&type=section&id=Notes%20to%20the%20Financial%20Statements) This section provides detailed notes to the financial statements, covering company information, basis of preparation, changes in accounting policies, segment information, revenue, other income and gains, finance costs, profit before tax, income tax, dividends, earnings per share, inventories, trade and bills receivables, and trade and bills payables [Company Information, Basis of Preparation, Changes in Accounting Policies](index=6&type=section&id=Company%20Information%2C%20Basis%20of%20Preparation%2C%20Changes%20in%20Accounting%20Policies) This section explains Dawnrays Pharmaceutical (Holdings) Limited's registration, group restructuring history, main business scope, the basis for preparing interim financial information (IAS 34 and HKEX Listing Rules), and changes in accounting policies adopted during the period, particularly the impact of IAS 21 amendments on currencies lacking exchangeability - The company was incorporated in the Cayman Islands on September 20, 2002, and listed on the Main Board of the Stock Exchange on July 11, 2003, primarily engaging in the development, manufacturing, and sale of generic drugs, including intermediates, APIs, and finished drugs[10](index=10&type=chunk)[11](index=11&type=chunk) - The interim financial information is prepared in accordance with IAS 34 "Interim Financial Reporting" and all applicable disclosure requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, presented in RMB[12](index=12&type=chunk) - The amendments to IAS 21 regarding lack of exchangeability have no impact on this interim condensed consolidated financial information, as the group's transaction and functional currencies are all exchangeable[13](index=13&type=chunk) [Company and Group Information](index=6&type=section&id=Company%20and%20Group%20Information) This section introduces Dawnrays Pharmaceutical (Holdings) Limited's place of incorporation, listing date, and primary business of developing, manufacturing, and selling generic drugs - Dawnrays Pharmaceutical (Holdings) Limited was incorporated in the Cayman Islands on September 20, 2002, and listed on the Main Board of the Stock Exchange on July 11, 2003[10](index=10&type=chunk)[11](index=11&type=chunk) - The Group is primarily engaged in the development, manufacturing, and sale of generic drugs, including intermediates, APIs, and finished drugs[11](index=11&type=chunk) [Basis of Preparation](index=6&type=section&id=Basis%20of%20Preparation) This section states that the interim financial information is prepared in accordance with IAS 34 "Interim Financial Reporting" and the HKEX Listing Rules, presented on a historical cost basis, with RMB as the presentation currency - The interim financial information is prepared in accordance with IAS 34 "Interim Financial Reporting" and all applicable disclosure requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[12](index=12&type=chunk) - The financial information is prepared on a historical cost basis, except for financial assets and liabilities measured at fair value through profit or loss[12](index=12&type=chunk) [Changes in Accounting Policies and Disclosures](index=7&type=section&id=Changes%20in%20Accounting%20Policies%20and%20Disclosures) This section notes that the accounting policies adopted in this period are consistent with the previous year, with the only new adoption being the revised IAS 21 "Lack of Exchangeability," which has no material impact on the Group's financial information - The accounting policies adopted in the preparation of this interim condensed consolidated financial information are consistent with those used in the preparation of the Group's annual consolidated financial statements for the year ended December 31, 2024[13](index=13&type=chunk) - The amendments to IAS 21 "Lack of Exchangeability" were first adopted in this period's financial information, but as the Group's transaction currencies are all exchangeable, these amendments have no impact on the interim condensed consolidated financial information[13](index=13&type=chunk) [Segment Information](index=7&type=section&id=Segment%20Information) The Group's business is divided into two reportable segments: finished drugs (including antibiotic and non-antibiotic preparations) and intermediates and APIs; management assesses segment performance based on adjusted profit before tax, with finished drugs accounting for the largest share of external sales and significant growth in intermediates and APIs sales - The Group's business is divided into two reportable segments: manufacturing and sale of finished drugs ("Finished Drugs" segment) and manufacturing and sale of intermediates and APIs ("Intermediates and APIs" segment)[14](index=14&type=chunk)[16](index=16&type=chunk) Segment Revenue (External Sales) | Segment Revenue (External Sales) | 2025 (thousand RMB) | 2024 (thousand RMB) | | :--- | :--- | :--- | | Finished Drugs | 590,208 | 560,878 | | Intermediates and APIs | 40,216 | 16,569 | | Total | 630,424 | 577,447 | Segment Results | Segment Results | 2025 (thousand RMB) | 2024 (thousand RMB) | | :--- | :--- | :--- | | Finished Drugs | 250,864 | 264,462 | | Intermediates and APIs | (25,216) | (25,858) | | Total | 225,648 | 238,604 | [Revenue, Other Income and Gains](index=9&type=section&id=Revenue%2C%20Other%20Income%20and%20Gains) During the reporting period, the Group's revenue primarily came from contracts with customers, totaling **RMB 630,424 thousand**, with finished drug sales accounting for the vast majority; total other income and gains were **RMB 30,861 thousand**, a significant decrease from the prior year, mainly due to large gains from the disposal of an associate and government grants in the previous period Revenue Sources | Revenue Source | 2025 (thousand RMB) | 2024 (thousand RMB) | | :--- | :--- | :--- | | Revenue from Contracts with Customers | 630,424 | 577,447 | Other Income and Gains | Other Income and Gains | 2025 (thousand RMB) | 2024 (thousand RMB) | | :--- | :--- | :--- | | Bank Interest Income | 16,649 | 15,498 | | Government Grants | 6,375 | 113,567 | | Gain on Disposal of an Associate | - | 286,670 | | Exchange Gain, Net | 1,103 | - | | Fair Value Gain on Financial Assets at Fair Value Through Profit or Loss, Net | 4,474 | 4,093 | | **Total Other Income and Gains** | **30,861** | **421,636** | - In the first half of 2025, the Mainland China market contributed **RMB 619,773 thousand** in revenue, while other countries contributed **RMB 10,651 thousand**[20](index=20&type=chunk) [Finance Costs](index=11&type=section&id=Finance%20Costs) Total finance costs for the period were **RMB 314 thousand**, a significant decrease from **RMB 2,660 thousand** in the prior period, primarily due to a notable reduction in bank loan interest Finance Cost Items | Finance Cost Item | 2025 (thousand RMB) | 2024 (thousand RMB) | | :--- | :--- | :--- | | Interest on Bank Loans | 157 | 2,492 | | Interest on Discounted Bills Receivable | 155 | 144 | | Interest on Lease Liabilities | 2 | 24 | | **Total** | **314** | **2,660** | [Profit Before Tax](index=12&type=section&id=Profit%20Before%20Tax) Profit before tax was **RMB 130,317 thousand**, a significant decrease from the prior period; this section details various expenses and income affecting profit before tax, including cost of sales, depreciation, R&D costs, employee benefit expenses, inventory write-downs, impairment loss on intangible assets, and government grants Expense/Income Items | Expense/Income Item | 2025 (thousand RMB) | 2024 (thousand RMB) | | :--- | :--- | :--- | | Cost of Sales | 316,446 | 239,535 | | Depreciation of Property, Plant and Equipment | 37,518 | 33,451 | | Research and Development Costs | 56,816 | 43,883 | | Employee Benefit Expenses | 108,715 | 106,147 | | Write-down of Inventories to Net Realizable Value | 21,569 | 24,492 | | Impairment Loss on Intangible Assets | 7,622 | - | | Government Grants | (6,375) | (113,567) | [Income Tax](index=13&type=section&id=Income%20Tax) Total income tax expense for the period was **RMB 28,609 thousand**, a decrease from **RMB 65,169 thousand** in the prior period, with no taxable profit generated in Hong Kong and taxes for Mainland China subsidiaries calculated at local applicable rates Income Tax Items | Income Tax Item | 2025 (thousand RMB) | 2024 (thousand RMB) | | :--- | :--- | :--- | | Current Income Tax Expense | 19,527 | 41,256 | | Deferred Tax | 9,421 | 24,053 | | **Total Tax Expense for the Period** | **28,609** | **65,169** | - The Group generated no taxable profit in Hong Kong, and taxes for its Mainland China subsidiaries are calculated at local applicable tax rates[25](index=25&type=chunk) [Dividends](index=13&type=section&id=Dividends) The Board resolved to declare an interim dividend of **HKD 0.015** per share for the year ending December 31, 2025, consistent with the prior period; total final and special dividends declared for the previous year in this period amounted to **RMB 112,229 thousand** Dividend Types | Dividend Type | 2025 (thousand RMB) | 2024 (thousand RMB) | | :--- | :--- | :--- | | Final Dividend: HKD 0.048 per ordinary share (2023: HKD 0.065) | 67,337 | 90,786 | | Special Dividend: HKD 0.032 per ordinary share (2023: Nil) | 44,892 | - | | Interim Dividend: HKD 0.015 per ordinary share | 20,710 | 20,594 | - The Board declared an interim dividend of **HKD 0.015** per share for the year ending December 31, 2025, totaling approximately **RMB 20,710 thousand**[26](index=26&type=chunk) [Earnings Per Share Attributable to Owners of the Parent](index=14&type=section&id=Earnings%20Per%20Share%20Attributable%20to%20Owners%20of%20the%20Parent) This section details the calculation and results for basic and diluted earnings per share, with basic EPS for the first half of 2025 at **RMB 0.06961**, a significant decrease from **RMB 0.3286** in the prior period [Basic Earnings Per Share](index=14&type=section&id=Basic%20Earnings%20Per%20Share) Basic earnings per share is calculated by dividing the profit attributable to owners of the parent for the period by the weighted average number of ordinary shares outstanding during the period | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Profit Attributable to Owners of the Parent (thousand RMB) | 104,572 | 493,046 | | Weighted Average Number of Ordinary Shares Outstanding for Basic EPS (thousand shares) | 1,502,199 | 1,500,393 | | **Basic Earnings Per Share (RMB)** | **0.06961** | **0.3286** | [Diluted Earnings Per Share](index=14&type=section&id=Diluted%20Earnings%20Per%20Share) Diluted earnings per share calculation considers the dilutive effect of ordinary shares, such as share options, and was **RMB 0.06958** for the first half of 2025 | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Profit Attributable to Owners of the Parent (thousand RMB) | 104,572 | 493,046 | | Weighted Average Number of Ordinary Shares Outstanding for Basic EPS (thousand shares) | 1,502,199 | 1,500,393 | | Dilutive Effect – Weighted Average Number of Ordinary Shares: Share Options (thousand shares) | 822 | 1,935 | | Weighted Average Number of Ordinary Shares Adjusted for Dilutive Effect (thousand shares) | 1,503,021 | 1,502,328 | | **Diluted Earnings Per Share (RMB)** | **0.06958** | **0.3282** | [Inventories](index=15&type=section&id=Inventories) As of June 30, 2025, the Group's total inventories amounted to **RMB 254,100 thousand**, a decrease from **RMB 308,241 thousand** as of December 31, 2024, primarily reflecting reductions in finished goods and raw materials Inventory Categories | Inventory Category | June 30, 2025 (thousand RMB) | December 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Raw Materials | 87,275 | 98,128 | | Work-in-progress | 52,825 | 55,484 | | Finished Goods | 114,000 | 154,629 | | **Total** | **254,100** | **308,241** | [Trade and Bills Receivables](index=15&type=section&id=Trade%20and%20Bills%20Receivables) As of June 30, 2025, the net book value of trade and bills receivables was **RMB 247,272 thousand**, a decrease from **RMB 267,886 thousand** as of December 31, 2024; the Group primarily transacts with customers on credit, with a typical credit period of three months for major customers Receivables | Receivables | June 30, 2025 (thousand RMB) | December 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Trade Receivables | 125,335 | 123,895 | | Bills Receivables | 123,534 | 145,588 | | Impairment | (1,597) | (1,597) | | **Net Book Value** | **247,272** | **267,886** | - The aging analysis of trade receivables shows that amounts due within **90 days** account for the largest proportion, totaling **RMB 97,322 thousand**[31](index=31&type=chunk) [Trade and Bills Payables](index=16&type=section&id=Trade%20and%20Bills%20Payables) As of June 30, 2025, total trade and bills payables amounted to **RMB 204,884 thousand**, a decrease from **RMB 221,560 thousand** as of December 31, 2024; trade payables are non-interest bearing and generally settled on a **90-day** credit term Payables | Payables | June 30, 2025 (thousand RMB) | December 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Within 90 days | 154,804 | 153,810 | | 91 to 180 days | 47,880 | 66,682 | | 181 to 270 days | 506 | 679 | | 271 to 360 days | 547 | 38 | | Over one year | 1,147 | 351 | | **Total** | **204,884** | **221,560** | - Trade payables are non-interest bearing and generally settled on a **90-day** credit term[32](index=32&type=chunk) [Management Discussion and Analysis](index=17&type=section&id=Management%20Discussion%20and%20Analysis) This section provides management's discussion and analysis of the Group's performance, industry environment, business review, product R&D, new products, patent authorization, other matters, honors, and outlook [Overview of Results](index=17&type=section&id=Overview%20of%20Results) The Group's revenue grew by **9.2%** to **RMB 630,424 thousand** in the first half of 2025; however, profit attributable to owners of the parent significantly decreased by **78.8%** to **RMB 104,572 thousand**, mainly due to non-recurring profits in the prior period from the disposal of an associate and government subsidies, with operating profit (excluding non-recurring items) decreasing by **17.1%** | Metric | 2025 (thousand RMB) | 2024 (thousand RMB) | Change | | :--- | :--- | :--- | :--- | | Revenue | 630,424 | 577,447 | 9.2% | | Profit Attributable to Owners of the Parent | 104,572 | 493,046 | -78.8% | | Operating Profit (excluding non-recurring profit) | 104,572 | 126,127 | -17.1% | - The decline in profit is primarily attributed to the Suzhou Dawnrays Shanfeng Road plant and Lanzhou Dawnrays not yet achieving scaled commercial production, price reductions for "An" series products due to centralized procurement, and increased R&D expenses[33](index=33&type=chunk) [Industry Environment](index=17&type=section&id=Industry%20Environment) In the first half of 2025, the pharmaceutical industry faced a complex landscape of policy changes, market competition, and quality enhancement; the National Healthcare Security Administration optimized drug centralized procurement policies, strengthening quality assessment and supervision, expanding procurement coverage, and increasing price transparency, while an aging population and rising incidence of chronic and severe diseases created a broad market for generic drugs, and AI technology profoundly impacted R&D, production, and marketing - In 2025, centralized procurement entered a new phase, with the National Healthcare Security Administration optimizing drug centralized procurement policies, strengthening quality assessment and supervision, and promoting special governance of drug online listing prices[34](index=34&type=chunk) - Global aging and the rising incidence of chronic diseases, tumors, and mental illnesses create a broad market space for generic drugs[34](index=34&type=chunk) - The application of AI technology has a significant impact on various aspects of the pharmaceutical industry, including R&D, production, and marketing, driving pharmaceutical enterprises towards transformation, innovation, and industrial collaboration[35](index=35&type=chunk) [Business Review](index=17&type=section&id=Business%20Review) Overall sales increased by **9.2%** year-on-year during the period; product line performance varied, with "An" series sales decreasing by **22.1%** due to centralized procurement, antiviral drug Entecavir Dispersible Tablets sales growing by **8.7%**, Fujian Dawnrays product series sales increasing by **16.6%**, and Cefazolin powder injection sales growing by **55.7%**, while intermediates and APIs sales significantly increased by **142.7%** due to new plant operations - Overall sales increased by **9.2%** compared to the same period last year[36](index=36&type=chunk) Product Category Sales Changes | Product Category | Sales Volume Change | Sales Value Change | | :--- | :--- | :--- | | "An" Series Products | Decreased by 5.7% | Decreased by 22.1% | | Entecavir Dispersible Tablets | Increased by 14.0% | Increased by 8.7% | | Fujian Dawnrays Product Series | Increased by 19.5% | Increased by 16.6% | | Cefazolin Powder for Injection | Increased by 47.9% | Increased by 55.7% | | Intermediates and APIs | Increased by 244.8% | Increased by 142.7% | - The significant increase in intermediates and APIs sales is primarily due to the successive commercial production at Suzhou Dawnrays Shanfeng Road plant and Lanzhou Dawnrays[37](index=37&type=chunk) [Product Research and Development](index=18&type=section&id=Product%20Research%20and%20Development) The Group leverages the Suzhou Dawnrays Advanced Technology Research Institute as a platform to coordinate R&D teams, undertaking generic drug R&D and technical optimization, continuously investing resources in technological improvements and product R&D innovation, and seeking external collaborations; to integrate R&D resources, the Group has divested its equity in Nanjing Fumeiruisin Technology Co., Ltd., a subsidiary with negative net book assets - The Group utilizes the Suzhou Dawnrays Advanced Technology Research Institute as a platform to coordinate and manage R&D technical teams, undertaking the research and development of raw materials and preparations for generic drugs[38](index=38&type=chunk) - The Group will continue to invest more resources in technological improvements and product R&D innovation, while actively seeking various forms of external cooperation opportunities[38](index=38&type=chunk) - To integrate R&D resources, the Group has sold all its equity in Nanjing Fumeiruisin Technology Co., Ltd., a subsidiary with negative net book assets, to an independent third party, which will not have a significant impact on R&D projects[38](index=38&type=chunk) [New Products and Patent Authorization](index=18&type=section&id=New%20Products%20and%20Patent%20Authorization) During the period, the Group received approval from the National Medical Products Administration's Center for Drug Evaluation for **2 specifications** (Rivaroxaban Tablets 10mg and 15mg), submitted registration applications for **6 other specifications** (3 APIs, 3 preparations) which were accepted, and obtained **2 patent certificates**, including one utility model patent and one invention patent - During the period, **2 specifications** (Rivaroxaban Tablets 10mg and Rivaroxaban Tablets 15mg) received approval from the National Medical Products Administration's Center for Drug Evaluation[39](index=39&type=chunk) - Additionally, **6 specifications** (3 APIs, 3 preparations) have been submitted for registration to the Center for Drug Evaluation and accepted[39](index=39&type=chunk) - The Group obtained **2 patent certificates**: "A Particle Counting Machine Vibration Device" (utility model patent) and "Tedizolid Phosphate for Injection Powder and its Preparation Method" (invention patent)[40](index=40&type=chunk) [Other Matters](index=18&type=section&id=Other%20Matters) The Group consistently adheres to a quality-first management policy, with product quality steadily improving; corporate governance, social responsibility, and environmental safety initiatives are progressing orderly, and significant advancements have been made in optimizing company structure, employee training, performance appraisal reform, digitalization, and risk control - The Group adheres to a quality-first management policy, with product quality steadily improving[41](index=41&type=chunk) - Corporate governance, social responsibility, and environmental safety initiatives are progressing orderly, and the company structure has been further optimized[41](index=41&type=chunk) - Significant progress has been made in employee training, performance appraisal reform, digitalization, and risk control[41](index=41&type=chunk) [Honors](index=19&type=section&id=Honors) In the first half of 2025, several of the Group's subsidiaries received multiple honors, including "Special Award for Outstanding Economic Contribution Enterprise," "Outstanding Employer" recognition, "Fujian Province New Excellent Pharmaceutical and Classic Traditional Chinese Medicine Products" certification, and "Specialized, Refined, Unique, and Novel" SME certification - Fujian Dawnrays Pharmaceutical Co., Ltd. was awarded the "2024 Special Award for Outstanding Economic Contribution Enterprise" by the Licheng District People's Government and the "2024 Outstanding Economic Contribution (Taxation of RMB 50 million - 100 million)" honor by the Putian Municipal People's Government[42](index=42&type=chunk) - Suzhou Dawnrays Pharmaceutical Co., Ltd. was awarded the "2025 Outstanding Employer" honor by 51job[42](index=42&type=chunk) - Lanzhou Dawnrays Pharmaceutical Co., Ltd. was recognized as a "Specialized, Refined, Unique, and Novel" SME by the Gansu Provincial Department of Industry and Information Technology[42](index=42&type=chunk) [Outlook](index=19&type=section&id=Outlook) Facing intensifying competition in the generic drug industry and deepening healthcare cost control policies, the Group will continue to increase R&D investment, focus on core areas, combine imitation with innovation, and actively explore the broader health and non-medical insurance consumer goods markets to create a second growth curve; simultaneously, it will uphold quality-first principles, optimize production processes, reduce costs, expand domestic and international markets through multiple channels, apply AI and other digital technologies to enhance operational efficiency, and improve talent development and incentive mechanisms - The Group will continue to increase R&D investment, leverage the Advanced Technology Research Institute platform, focus on core areas, combine imitation with innovation, and strengthen cooperation with universities and research institutions[43](index=43&type=chunk) - Actively explore the broader health sector and non-medical insurance healthcare consumer goods, seek external partners, expand new businesses, and create a second growth curve[43](index=43&type=chunk) - Continue to uphold the business philosophy of customer-first and quality-first, organize production strictly in accordance with GMP requirements, and optimize production processes, introduce advanced equipment and technology, and reduce production costs[43](index=43&type=chunk) - For the domestic market, actively participate in centralized drug procurement to expand market share; for the international market, systematically carry out international certification work[44](index=44&type=chunk) - Formulate a five-year plan, from business digitalization and digital empowerment to AI intelligent integration and innovation, applying new technologies to R&D, production, sales, and management to build a digital technology platform[44](index=44&type=chunk) - Improve talent recruitment plans, implement three major human resource systems, establish a scientific and reasonable talent development and career progression system, and enhance performance management and incentive mechanisms[45](index=45&type=chunk) [Financial Review](index=20&type=section&id=Financial%20Review) This section provides a financial review of the Group's sales, gross profit, expenses, segment profit, profit attributable to owners of the parent, and asset profitability analysis [Sales and Gross Profit](index=20&type=section&id=Sales%20and%20Gross%20Profit) During the period, turnover increased by **9.2%** to **RMB 630,424 thousand**, with finished drug sales growing by **5.2%** and intermediates and APIs sales significantly increasing by **142.7%**; finished drug sales accounted for **93.6%** of total turnover, while gross profit decreased by **7.1%** year-on-year to **RMB 313,978 thousand**, and gross profit margin declined by **8.7 percentage points** to **49.8%**, mainly due to high production costs for intermediates and APIs that have not yet reached full capacity and decreased gross profit for "An" series products | Metric | 2025 (thousand RMB) | 2024 (thousand RMB) | Change | | :--- | :--- | :--- | :--- | | Turnover | 630,424 | 577,447 | 9.2% | | Finished Drug Sales | 590,208 | 560,878 | 5.2% | | Intermediates and APIs Sales | 40,216 | 16,569 | 142.7% | | Gross Profit | 313,978 | 337,912 | -7.1% | | Gross Profit Margin | 49.8% | 58.5% | -8.7 percentage points | - Finished drug sales accounted for approximately **93.6%** of total sales, a **3.5 percentage point** decrease from the previous year[46](index=46&type=chunk) - Export sales amounted to approximately **RMB 10,651 thousand**, accounting for **1.7%** of total turnover, a year-on-year increase of **229.0%**[46](index=46&type=chunk) [Expenses](index=21&type=section&id=Expenses) Total expenses for the period were approximately **RMB 214,522 thousand**, accounting for **34.0%** of turnover, a **0.5 percentage point** decrease from the prior period; selling expenses decreased, while administrative expenses, R&D expenses, and other expenses all increased Expense Categories | Expense Category | 2025 (thousand RMB) | 2024 (thousand RMB) | Change | | :--- | :--- | :--- | :--- | | Selling Expenses | 56,830 | 68,911 | -12,081 (Decreased by 17.5%) | | Administrative Expenses | 67,491 | 54,148 | +13,343 (Increased by 24.6%) | | Research and Development Expenses | 56,816 | 43,883 | +12,933 (Increased by 29.5%) | | Other Expenses | 33,071 | 29,498 | +3,573 (Increased by 12.1%) | | **Total Expenses** | **214,522** | **199,140** | **+15,382 (Increased by 7.7%)** | - The decrease in selling expenses is mainly due to the increased proportion of centralized procurement products; the increase in administrative expenses is primarily due to the reclassification of surtaxes and intangible asset amortization expenses; R&D expenses increased by **29.5%**; the increase in other expenses is mainly due to inventory write-downs and idle capacity losses from high unit costs of Suzhou Dawnrays and Lanzhou Dawnrays products, as well as impairment loss on intangible assets of Nanjing Fumeiruisin[49](index=49&type=chunk) [Segment Profit](index=21&type=section&id=Segment%20Profit) Finished drug segment profit decreased to **RMB 250,864 thousand**, mainly due to the impact of centralized procurement policies leading to a decline in gross profit; the intermediates and APIs segment reported a loss of approximately **RMB 25,216 thousand**, similar to the prior period, primarily due to increased costs from the Suzhou Dawnrays Shanfeng Road plant and Lanzhou Dawnrays not yet reaching full production capacity Segment Profit/Loss | Segment Profit/Loss | 2025 (thousand RMB) | 2024 (thousand RMB) | Change | | :--- | :--- | :--- | :--- | | Finished Drugs Segment | 250,864 | 264,462 | -13,598 | | Intermediates and APIs Segment | (25,216) | (25,858) | +642 | - The decrease in finished drug segment profit is mainly due to the impact of centralized procurement on "An" series products, leading to a decline in gross profit[50](index=50&type=chunk) - The loss in the intermediates and APIs segment is primarily due to increased costs resulting from the Suzhou Dawnrays Shanfeng Road plant and Lanzhou Dawnrays not yet reaching full production capacity[50](index=50&type=chunk) [Profit Attributable to Owners of the Parent](index=21&type=section&id=Profit%20Attributable%20to%20Owners%20of%20the%20Parent) Profit attributable to owners of the parent for the period was **RMB 104,572 thousand**, a year-on-year decrease of **78.8%**; excluding the net gain from the disposal of Kangrong Dongfang equity and government subsidies for Suzhou Dawnrays in 2024, operating profit decreased by **17.1%** year-on-year | Metric | 2025 (thousand RMB) | 2024 (thousand RMB) | Change | | :--- | :--- | :--- | :--- | | Profit Attributable to Owners of the Parent | 104,572 | 493,046 | -78.8% | | Excluding Non-recurring Profit | 104,572 | 126,127 | -17.1% | - Non-recurring profit in 2024 included a net gain of approximately **RMB 277,627 thousand** from the disposal of a **35%** equity interest in Kangrong Dongfang and a net gain of approximately **RMB 89,292 thousand** from government subsidies for equipment validation at Suzhou Dawnrays Tianling Road[51](index=51&type=chunk) [Asset Profitability Analysis](index=21&type=section&id=Asset%20Profitability%20Analysis) As of June 30, 2025, the return on net assets was **3.2%**, a significant decrease from **15.1%** in 2024; the current ratio and quick ratio were **4.78** and **4.21**, respectively; accounts receivable turnover period was approximately **74 days**, a **22-day** reduction year-on-year, and inventory turnover period was approximately **160 days**, an **8-day** reduction year-on-year, indicating improved management of receivables and inventories | Metric | June 30, 2025 | 2024 | | :--- | :--- | :--- | | Return on Net Assets | 3.2% | 15.1% | | Current Ratio | 4.78 | - | | Quick Ratio | 4.21 | - | | Accounts Receivable (including trade and bills receivables) Turnover Period | Approx. 74 days | (Decreased by 22 days year-on-year) | | Inventory Turnover Period | Approx. 160 days | (Decreased by 8 days year-on-year) | - The decrease in accounts receivable turnover period is mainly due to strengthened management of accounts receivable[52](index=52&type=chunk) - The decrease in inventory turnover period is mainly due to Suzhou Dawnrays' lean production activities reducing inventory[52](index=52&type=chunk) [Liquidity and Financial Resources](index=22&type=section&id=Liquidity%20and%20Financial%20Resources) This section details the Group's cash and financial assets, cash flow, bank facilities, debt ratio, and inventory balance, providing an overview of its liquidity and financial health [Cash and Financial Assets](index=22&type=section&id=Cash%20and%20Financial%20Assets) As of June 30, 2025, the Group held cash and bank balances of approximately **RMB 1,139,131 thousand**, and financial assets at fair value through profit or loss totaling approximately **RMB 281,353 thousand**, including investments in listed shares and principal-protected floating-rate structured deposits Asset Categories | Asset Category | June 30, 2025 (thousand RMB) | December 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Cash and Bank Balances | 1,139,131 | 1,158,261 | | Financial Assets at Fair Value Through Profit or Loss | 281,353 | 227,135 | | Bills Receivable | 123,534 | 145,588 | - Financial assets at fair value through profit or loss include approximately **RMB 15,356 thousand** in Hong Kong listed share investments and approximately **RMB 245,200 thousand** in principal-protected floating-rate structured deposits[53](index=53&type=chunk)[55](index=55&type=chunk) [Cash Flow](index=22&type=section&id=Cash%20Flow) During the period, net cash inflow from operating activities was approximately **RMB 201,983 thousand**, net cash outflow from investing activities was approximately **RMB 439,071 thousand**, and net cash outflow from financing activities was approximately **RMB 127,398 thousand**, resulting in a net decrease in cash and cash equivalents of approximately **RMB 364,486 thousand** Cash Flow Activities | Cash Flow Activity | 2025 (thousand RMB) | 2024 (thousand RMB) | | :--- | :--- | :--- | | Net Cash Inflow from Operating Activities | 201,983 | 171,454 | | Net Cash Outflow from Investing Activities | (439,071) | 29,185 (Inflow) | | Net Cash Outflow from Financing Activities | (127,398) | (31,428) | | **Net Change in Cash and Cash Equivalents** | **(364,486)** | **169,211 (Increase)** | [Bank Facilities and Debt Ratio](index=22&type=section&id=Bank%20Facilities%20and%20Debt%20Ratio) As of June 30, 2025, the Group's total bank facilities amounted to **RMB 1,713,000 thousand**, interest-bearing bank and other borrowings were approximately **RMB 8,995 thousand**, and the debt ratio was **0.2%**, indicating low financial leverage Bank Facilities and Debt Ratio | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Bank Facilities | RMB 1,713,000 thousand | RMB 1,613,000 thousand | | Interest-bearing Bank and Other Borrowings | RMB 8,995 thousand | RMB 29,864 thousand | | Debt Ratio | 0.2% | 0.7% | [Inventory Balance](index=23&type=section&id=Inventory%20Balance) As of June 30, 2025, the Group's inventory balance was approximately **RMB 254,100 thousand**, a decrease from **RMB 308,241 thousand** as of December 31, 2024 Inventory Balance | Metric | June 30, 2025 (thousand RMB) | December 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Inventory Balance | 254,100 | 308,241 | [Major Investments and Asset Changes](index=23&type=section&id=Major%20Investments%20and%20Asset%20Changes) This section outlines the Group's major investments and asset changes, including the Lanzhou Dawnrays project, Suzhou Dawnrays relocation project, divestment of Fumeiruisin equity, and goodwill and capital expenditure commitments [Lanzhou Dawnrays Project](index=23&type=section&id=Lanzhou%20Dawnrays%20Project) Lanzhou Dawnrays, an API and intermediate production base, has a registered capital of **RMB 540,344 thousand**, with Suzhou Dawnrays investing **RMB 34,594 thousand** in subscribed capital during the period; Phase I of the project is completed and in production, while Phase II plans an investment of **RMB 29,000 thousand** for new product equipment additions and process improvements - Lanzhou Dawnrays has a registered capital of **RMB 540,344 thousand**, with Suzhou Dawnrays investing **RMB 34,594 thousand** in subscribed capital during the period[57](index=57&type=chunk) - Phase I of the project has been completed and put into production, and Phase II plans an investment of **RMB 29,000 thousand** for new product equipment additions and process improvements[57](index=57&type=chunk) [Suzhou Dawnrays Relocation Project](index=23&type=section&id=Suzhou%20Dawnrays%20Relocation%20Project) The overall relocation project of Suzhou Dawnrays Tianling Road plant is completed, with **RMB 175,595 thousand** in demolition compensation received, and the remaining balance being pursued; currently, the Shanfeng Road environmental protection building and Minfeng Road plant workshop renovation projects are underway, with an investment of approximately **RMB 27,000 thousand** - The overall relocation project of Suzhou Dawnrays Tianling Road plant has been completed, and **RMB 175,595 thousand** in demolition compensation has been received[57](index=57&type=chunk) - Currently, the Shanfeng Road environmental protection building project and Minfeng Road plant workshop renovation project are underway, with a total investment of approximately **RMB 27,000 thousand**[57](index=57&type=chunk) [Divestment of Fumeiruisin Equity](index=23&type=section&id=Divestment%20of%20Fumeiruisin%20Equity) To integrate R&D resources, the Group transferred its **65%** equity interest in Nanjing Fumeiruisin Technology Co., Ltd., a controlled subsidiary with negative net book assets, to an independent third party for **RMB 100 thousand** on June 9, 2025 - On June 9, 2025, the Group transferred its **65%** equity interest in Nanjing Fumeiruisin Technology Co., Ltd. to an independent third party for **RMB 100 thousand**[58](index=58&type=chunk) - The reason for the disposal is to integrate R&D resources, as Fumeiruisin's net book assets had become negative due to continuous losses over the years[58](index=58&type=chunk) [Goodwill and Capital Expenditure Commitments](index=23&type=section&id=Goodwill%20and%20Capital%20Expenditure%20Commitments) As of June 30, 2025, the goodwill of **RMB 241,158 thousand** arising from the acquisition of Fujian Dawnrays Pharmaceutical Co., Ltd. showed no signs of impairment; the Group had contracted but unprovided capital expenditure commitments for plant and machinery totaling approximately **RMB 41,513 thousand**, mainly related to the Lanzhou Dawnrays and Suzhou Dawnrays projects - As of June 30, 2025, the goodwill of **RMB 241,158 thousand** arising from the acquisition of Fujian Dawnrays Pharmaceutical Co., Ltd. showed no signs of impairment[58](index=58&type=chunk) - Contracted but unprovided capital expenditure commitments for plant and machinery totaled approximately **RMB 41,513 thousand**, mainly involving the Lanzhou Dawnrays project and the Suzhou Dawnrays relocation and renovation projects[58](index=58&type=chunk) [Other Disclosures](index=24&type=section&id=Other%20Disclosures) This section covers other disclosures, including foreign currency and treasury policy, employees and remuneration policy, asset pledges, contingent liabilities, future major investments and expected funding sources, and purchase, redemption, or sale of listed securities [Foreign Currency and Treasury Policy](index=24&type=section&id=Foreign%20Currency%20and%20Treasury%20Policy) During the period, the Group recorded an exchange gain of approximately **RMB 1,103 thousand**, with most business transactions settled in RMB, indicating limited foreign exchange risk, primarily related to HKD dividend payments; the Group will continue to monitor foreign exchange and interest rate market conditions and hedge risks when necessary - An exchange gain of approximately **RMB 1,103 thousand** was recorded during the period (2024: loss of approximately **RMB 2,689 thousand**)[59](index=59&type=chunk) - Most of the Group's business transactions are settled in RMB, so foreign exchange risk is not significant, primarily related to HKD dividend payments[59](index=59&type=chunk) - The Group will continue to monitor foreign exchange and interest rate market conditions and, when necessary, hedge foreign exchange risk with forward foreign exchange contracts and interest rate risk with interest rate swap contracts[59](index=59&type=chunk) [Employees and Remuneration Policy](index=24&type=section&id=Employees%20and%20Remuneration%20Policy) As of June 30, 2025, the Group had **1,116 employees**, with total staff costs for the period amounting to approximately **RMB 108,715 thousand**, mainly due to annual salary adjustments; the Group values talent, offering market-competitive remuneration, retirement plans, share option schemes, and medical benefits Employees and Remuneration Policy | Metric | June 30, 2025 | 2024 | | :--- | :--- | :--- | | Number of Employees | 1,116 | - | | Total Staff Costs (thousand RMB) | 108,715 | 106,147 | - The increase in staff costs is primarily due to annual salary adjustments[60](index=60&type=chunk) - Remuneration policy refers to market compensation benchmarks and employee qualifications, offering defined contribution retirement plans, share option schemes, and medical benefits[60](index=60&type=chunk) [Asset Pledges](index=24&type=section&id=Asset%20Pledges) As of June 30, 2025, the Group had no assets pledged to banks to secure credit facilities - As of June 30, 2025, the Group had no assets pledged to banks to secure credit facilities granted to its subsidiaries[61](index=61&type=chunk) [Contingent Liabilities](index=24&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[62](index=62&type=chunk) [Future Major Investments and Expected Funding Sources](index=24&type=section&id=Future%20Major%20Investments%20and%20Expected%20Funding%20Sources) Apart from disclosed capital expenditure commitments, increased registered capital for subsidiaries, and capital investments in relocation projects, the Group has no other future major investment plans; the Group possesses sufficient financial and internal resources but may still use bank loans or internal resources to fund capital expenditures - Apart from disclosed capital expenditure commitments, increased registered capital for subsidiaries, and capital investments in relocation projects, the Group has no other future major investment plans[63](index=63&type=chunk) - The Group has sufficient financial and internal resources, but may still use bank loans or its internal resources to fund the aforementioned capital expenditure commitments[58](index=58&type=chunk) [Purchase, Redemption or Sale of Listed Securities](index=24&type=section&id=Purchase%2C%20Redemption%20or%20Sale%20of%20Listed%20Securities) For the six months ended June 30, 2025, neither the Company nor any of its subsidiaries purchased, redeemed, or sold any of the Company's listed securities - For the six months ended June 30, 2025, neither the Company nor any of its subsidiaries purchased, redeemed, or sold any of the Company's listed securities[64](index=64&type=chunk) [Corporate Governance](index=25&type=section&id=Corporate%20Governance) This section details the Company's compliance with the Corporate Governance Code, adherence to the Standard Code for Securities Transactions, and the role of the Audit Committee [Compliance with Corporate Governance Code](index=25&type=section&id=Compliance%20with%20Corporate%20Governance%20Code) For the six months ended June 30, 2025, the Company consistently complied with the Corporate Governance Code in Appendix C1 of the Listing Rules, with one exception where a non-executive director was unable to attend the annual general meeting due to other business arrangements - The Company has consistently complied with the Corporate Governance Code in Appendix C1 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[65](index=65&type=chunk) - There was one deviation: Mr. Liang Kangmin, a non-executive director, was unable to attend the annual general meeting due to other business arrangements[65](index=65&type=chunk) [Standard Code for Securities Transactions](index=25&type=section&id=Standard%20Code%20for%20Securities%20Transactions) The Company has adopted the Standard Code in Appendix C3 of the Listing Rules as the code of conduct for directors' dealings in the Company's securities and confirms that directors have complied with this code during the reporting period - The Company has adopted the Standard Code in Appendix C3 of the Listing Rules as the code of conduct for directors' dealings in the Company's securities[66](index=66&type=chunk) - During the six months ended June 30, 2025, the directors have complied with the standards set out in the Standard Code[66](index=66&type=chunk) [Audit Committee](index=25&type=section&id=Audit%20Committee) The Company has established an Audit Committee in compliance with Listing Rule 3.21 to oversee the financial reporting system, risk management, and internal control systems; the Audit Committee has reviewed the unaudited condensed consolidated interim financial statements for the period - The Company established an Audit Committee in compliance with Listing Rule 3.21 to oversee the Group's financial reporting system, risk management, and internal control systems[67](index=67&type=chunk) - The Audit Committee has reviewed the Company's unaudited condensed consolidated interim financial statements for the six months ended June 30, 2025, prior to their submission to the Board for approval[67](index=67&type=chunk) [Dividends and Others](index=25&type=section&id=Dividends%20and%20Others) This section covers the interim dividend declaration, suspension of share transfer registration for dividend entitlement, and an acknowledgement of gratitude [Interim Dividend](index=25&type=section&id=Interim%20Dividend) The Board resolved to declare an interim dividend of **HKD 0.015** per share for the year ending December 31, 2025, totaling approximately **HKD 22,546 thousand** - The Board resolved to declare an interim dividend of **HKD 0.015** per share for the year ending December 31, 2025, totaling approximately **HKD 22,546 thousand** (equivalent to approximately **RMB 20,710 thousand**)[68](index=68&type=chunk) [Suspension of Share Transfer Registration](index=25&type=section&id=Suspension%20of%20Share%20Transfer%20Registration) To determine eligibility for the interim dividend, the Company will suspend share transfer registration from September 18 to September 19, 2025, with the record date being September 19, 2025 - To determine eligibility for the interim dividend, the Company will suspend share transfer registration from September 18 to September 19, 2025 (both dates inclusive)[69](index=69&type=chunk) - The record date for determining shareholders' entitlement to receive the interim dividend is Friday, September 19, 2025[70](index=70&type=chunk) [Acknowledgement](index=26&type=section&id=Acknowledgement) The Chairman, on behalf of the Board, expresses sincere gratitude to shareholders, directors, business partners, management, and employees for their support to the Group during the period - The Chairman, on behalf of the Board, expresses sincere gratitude to the Company's shareholders, directors, and all business partners, management, and employees of the Group for their support during the period[71](index=71&type=chunk)

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內 容 概 不 負 責，對 其 準 確 性 或 完 整 性 亦 不 發 表 任 何 聲 明，並 明 確 表 示，概 不對因本公告全部或任何部分內容而產生或因倚賴該等內容而引致的 任 何 損 失 承 擔 任 何 責 任。 （於中華人民共和國註冊成立之股份有限公司） （股份代號：1772） 截 至2025年6月30日止六個月之中期業績公告 及 建議修訂公司章程 江 西 贛 鋒 鋰 業 集 團 股 份 有 限 公 司（「本公司」或「公 司」）董 事（「董 事」）會（「董 事 會」）謹 此 公 佈 本 公 司 及 其 附 屬 公 司（統 稱「本集團」）截 至2025年6月30日 止 六 個 月（「報告期」）之 簡 明 綜 合 未 經 審 計 中 期 業 績。 – 1 – 財務資料 中 期簡明綜合損益表 截 至2025年6月30日止六個月 | | 附 註 | 2025年 | 2024年 | | --- | --- | --- | --- | | | | （未 經 審 計） | （未 經 審 計） | | | | 人民幣千元 | 人民幣千元 | | 收 益 | 4 ...