[Company Overview and Financial Summary](index=1&type=section&id=I.%20Company%20Overview%20and%20Financial%20Summary) [Financial Summary](index=1&type=section&id=I.A.%20Financial%20Summary) K Cash Group reported significant growth in interest income and profit for H1 2025, declaring an interim dividend of 4.4 HK cents per share Financial Highlights | Metric | Six Months Ended June 30, 2025 (HKD '000) | Six Months Ended June 30, 2024 (HKD '000) | | :--- | :--- | :--- | | Interest Income | 164,552 | 136,029 | | Profit for the Period | 44,230 | 34,307 | | Earnings Per Share (Basic & Diluted) | 8.85 HK cents | 6.86 HK cents | - The Board resolved to declare an interim dividend of **4.4 HK cents per share** for the six months ended June 30, 2025[3](index=3&type=chunk) [Interim Condensed Consolidated Financial Statements](index=2&type=section&id=II.%20Interim%20Condensed%20Consolidated%20Financial%20Statements) [Consolidated Statement of Comprehensive Income](index=2&type=section&id=II.A.%20Consolidated%20Statement%20of%20Comprehensive%20Income) For H1 2025, the company achieved year-on-year growth in net interest income, operating profit, and profit, indicating enhanced profitability Consolidated Statement of Comprehensive Income | Metric | Six Months Ended June 30, 2025 (HKD '000) | Six Months Ended June 30, 2024 (HKD '000) | | :--- | :--- | :--- | | Interest Income | 164,552 | 136,029 | | Interest Expense | (18,509) | (14,585) | | Net Interest Income | 146,043 | 121,444 | | Other Income | 5,292 | 5,042 | | Net Other Losses | (2,355) | (923) | | Selling Expenses | (14,951) | (15,577) | | General and Administrative Expenses | (37,470) | (31,999) | | Net Expected Credit Losses | (43,916) | (36,407) | | Operating Profit | 52,643 | 41,580 | | Profit Before Income Tax | 51,869 | 41,285 | | Income Tax Expense | (7,639) | (6,978) | | Profit for the Period | 44,230 | 34,307 | | Total Comprehensive Income for the Period | 44,263 | 34,307 | | Basic and Diluted Earnings Per Share | 8.85 HK cents | 6.86 HK cents | [Consolidated Statement of Financial Position](index=3&type=section&id=II.B.%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, total assets and equity grew, with loans to customers as the main asset, while cash equivalents decreased Consolidated Statement of Financial Position | Metric | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | | :--- | :--- | :--- | | **Assets** | | | | Cash and Cash Equivalents | 41,614 | 116,428 | | Loans and Advances to Customers | 1,318,080 | 1,232,380 | | Total Assets | 1,461,168 | 1,449,835 | | **Equity and Liabilities** | | | | Total Equity | 934,363 | 917,600 | | Bank and Other Borrowings | 497,269 | 491,902 | | Total Liabilities | 526,805 | 532,235 | | Total Equity and Liabilities | 1,461,168 | 1,449,835 | - Cash and cash equivalents decreased, primarily due to increased advances to customers and interest payments on bank and other borrowings[43](index=43&type=chunk) [Notes to the Interim Condensed Consolidated Financial Information](index=4&type=section&id=III.%20Notes%20to%20the%20Interim%20Condensed%20Consolidated%20Financial%20Information) [General Information](index=4&type=section&id=III.A.%20General%20Information) K Cash Group, incorporated in the Cayman Islands, primarily provides unsecured loans in Hong Kong and was listed on HKEX in December 2023 - The Company was incorporated as an exempted company in the Cayman Islands on **October 25, 2022**[6](index=6&type=chunk) - The Group primarily engages in providing **unsecured loans in Hong Kong**[7](index=7&type=chunk) - The Company's shares were listed on the Main Board of The Stock Exchange of Hong Kong Limited on **December 5, 2023**[8](index=8&type=chunk) [Basis of Preparation and Accounting Policies](index=4&type=section&id=III.B.%20Basis%20of%20Preparation%20and%20Accounting%20Policies) Interim financial information is prepared under HKEX Listing Rules and HKAS 34, with consistent accounting policies and no significant impact from new standards [Basis of Preparation](index=4&type=section&id=III.B.1.%20Basis%20of%20Preparation) This interim financial information is prepared under HKEX Listing Rules Appendix D2 and HKAS 34 'Interim Financial Reporting' - The financial information is prepared in accordance with Appendix D2 of the HKEX Listing Rules and Hong Kong Accounting Standard 34 'Interim Financial Reporting'[9](index=9&type=chunk) [Accounting Policies](index=4&type=section&id=III.B.2.%20Accounting%20Policies) Accounting policies for interim financial information are consistent with the Group's annual consolidated financial statements for 2024 - The accounting policies adopted are consistent with those in the annual consolidated financial statements for the year ended **December 31, 2024**[10](index=10&type=chunk) [New and Revised Standards](index=4&type=section&id=III.B.3.%20New%20and%20Revised%20Standards) The Group adopted HKAS 21 and HKFRS 1 (Amendments) for 2025, with no significant impact expected on financial information - Adopted HKAS 21 and HKFRS 1 (Amendments) 'Lack of Exchangeability'[11](index=11&type=chunk) - The Directors' preliminary assessment indicates that the newly issued and revised standards and interpretations will not have any significant impact on the Group's operating results and financial position[12](index=12&type=chunk) [Accounting Estimates and Judgments](index=5&type=section&id=III.C.%20Accounting%20Estimates%20and%20Judgments) Key estimates and judgments for interim financial information are consistent with those applied in the 2024 annual consolidated financial statements - The key estimates and judgments made by management in applying accounting policies for the interim financial information are the same as those applied in the consolidated financial statements for the year ended **December 31, 2024**[13](index=13&type=chunk) [Segment Information and Revenue](index=6&type=section&id=III.D.%20Segment%20Information%20and%20Revenue) The Group's sole segment is unsecured lending in Hong Kong, with interest income mainly from homeowner loans; other income includes rent and credit cards, while net other losses are due to exchange fluctuations [Segment Information](index=6&type=section&id=III.D.1.%20Segment%20Information) The Group's executive directors review internal reports; unsecured lending in Hong Kong was the sole reportable segment for H1 2025 - The Group has only one operating segment, which is the provision of **unsecured loans in Hong Kong**[15](index=15&type=chunk) [Revenue Composition](index=6&type=section&id=III.D.2.%20Revenue%20Composition) For H1 2025, total interest income was HKD 164,552 thousand, primarily contributed by unsecured homeowner loans at HKD 121,400 thousand Interest Income by Source | Source of Interest Income | Six Months Ended June 30, 2025 (HKD '000) | Six Months Ended June 30, 2024 (HKD '000) | | :--- | :--- | :--- | | Unsecured Homeowner Loans | 121,400 | 96,789 | | Unsecured Personal Loans | 36,116 | 33,025 | | Credit Card Advances | 2,674 | 446 | | SME Loans | 4,362 | 5,769 | | **Total** | **164,552** | **136,029** | [Other Income and Net Other Losses](index=6&type=section&id=III.D.3.%20Other%20Income%20and%20Net%20Other%20Losses) For H1 2025, other income was HKD 5,292 thousand, mainly from related party rental and credit card income; net other losses were (HKD 2,355) thousand, impacted by exchange losses Other Income | Other Income | Six Months Ended June 30, 2025 (HKD '000) | Six Months Ended June 30, 2024 (HKD '000) | | :--- | :--- | :--- | | Rental income from fellow subsidiaries | 300 | 395 | | Rental income from a related party | 2,191 | 2,566 | | Bank interest income | 754 | 1,916 | | Credit card income | 2,019 | 164 | | Others | 28 | 1 | | **Total** | **5,292** | **5,042** | Net Other Losses | Net Other Losses | Six Months Ended June 30, 2025 (HKD '000) | Six Months Ended June 30, 2024 (HKD '000) | | :--- | :--- | :--- | | Net exchange losses | (7,483) | – | | Impairment allowance for recovered assets | (528) | – | | Change in surrender value of life insurance plan investments | 149 | (1,218) | | Fair value gain on derivative financial instruments | 5,884 | – | | Gain on termination of leases | – | 295 | | Loss on disposal of property, plant and equipment | (377) | – | | **Total** | **(2,355)** | **(923)** | [Loans and Advances to Customers](index=7&type=section&id=III.E.%20Loans%20and%20Advances%20to%20Customers) As of June 30, 2025, total loans and advances to customers amounted to HKD 1,318,080 thousand, primarily unsecured homeowner loans; net expected credit losses increased, and the company provided detailed aging analyses by overdue date and installment due date [Loan Portfolio Overview](index=7&type=section&id=III.E.1.%20Loan%20Portfolio%20Overview) As of June 30, 2025, total loans and advances to customers were HKD 1,428,893 thousand (net HKD 1,318,080 thousand), with unsecured homeowner loans being the largest portion Loans and Advances to Customers | Loan Type | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | | :--- | :--- | :--- | | Unsecured Homeowner Loans | 1,135,559 | 1,037,042 | | Unsecured Personal Loans | 249,377 | 253,103 | | Credit Card Advances | 26,967 | 12,002 | | SME Loans | 16,990 | 47,168 | | **Total** | **1,428,893** | **1,349,315** | | Less: Impairment Allowance | (110,813) | (116,935) | | **Net Amount** | **1,318,080** | **1,232,380** | - Loans and advances to customers are unsecured, interest-bearing, and repayable over fixed terms agreed with customers[18](index=18&type=chunk) [Net Expected Credit Losses](index=7&type=section&id=III.E.2.%20Net%20Expected%20Credit%20Losses) For H1 2025, net expected credit losses were HKD 43,916 thousand, an increase from the prior year, primarily due to the expanded loan portfolio Net Expected Credit Losses | Metric | Six Months Ended June 30, 2025 (HKD '000) | Six Months Ended June 30, 2024 (HKD '000) | | :--- | :--- | :--- | | Net Expected Credit Losses | 43,916 | 36,407 | - Expected credit losses are measured based on whether credit risk has significantly increased since initial recognition (Stage 1 or Stage 2)[19](index=19&type=chunk) [Aging Analysis of Loans and Advances (by Overdue Date)](index=8&type=section&id=III.E.3.%20Aging%20Analysis%20of%20Loans%20and%20Advances%20(by%20Overdue%20Date)) As of June 30, 2025, current portions of homeowner and personal loans remain dominant, but overdue over 90 days also warrants attention; current credit card advances significantly increased Loans and Advances Aging Analysis (by Overdue Date) | Loan Type | Aging | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | | :--- | :--- | :--- | :--- | | Unsecured Homeowner Loans | Current | 668,710 | 597,163 | | | Overdue over 90 days | 346,502 | 312,024 | | Unsecured Personal Loans | Current | 198,665 | 210,485 | | | Overdue over 90 days | 30,781 | 23,773 | | Credit Card Advances | Current | 24,076 | 5,501 | | | Overdue over 90 days | 1,397 | 511 | | SME Loans | Current | 3,647 | 15,476 | | | Overdue over 90 days | 5,110 | 24,757 | - As of June 30, 2025, the Group's impairment allowance for loans receivable was **HKD 110,813 thousand**, a decrease from **HKD 116,935 thousand** as of December 31, 2024[20](index=20&type=chunk) [Aging Analysis of Loans and Advances (by Installment Due Date)](index=9&type=section&id=III.E.4.%20Aging%20Analysis%20of%20Loans%20and%20Advances%20(by%20Installment%20Due%20Date)) As of June 30, 2025, most loans remain current, with unsecured homeowner loans having a current portion of HKD 942,025 thousand; the overdue over 90 days portion of SME loans significantly decreased Loans and Advances Aging Analysis (by Installment Due Date) | Loan Type | Aging | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | | :--- | :--- | :--- | :--- | | Unsecured Homeowner Loans | Current | 942,025 | 846,387 | | | Overdue over 90 days | 171,328 | 167,963 | | Personal Loans | Current | 231,509 | 237,146 | | | Overdue over 90 days | 11,484 | 10,911 | | Credit Card Advances | Current | 26,188 | 11,853 | | | Overdue over 90 days | 339 | 65 | | SME Loans | Current | 12,132 | 23,025 | | | Overdue over 90 days | 3,200 | 21,590 | [Bank and Other Borrowings](index=10&type=section&id=III.F.%20Bank%20and%20Other%20Borrowings) As of June 30, 2025, total bank and other borrowings amounted to HKD 497,269 thousand, with interest rates ranging from 5.10% to 9.53% per annum; most borrowings are repayable within 1 to 2 years Bank and Other Borrowings | Borrowing Type | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | | :--- | :--- | :--- | | Bank Loans | 365,593 | 351,926 | | Other Loans | 131,676 | 139,976 | | **Total** | **497,269** | **491,902** | Repayment Period | Repayment Period | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | | :--- | :--- | :--- | | Within 1 year | 112,326 | 141,805 | | 1 to 2 years | 384,943 | 350,097 | | **Total** | **497,269** | **491,902** | - For the six months ended June 30, 2025, interest rates for bank and other borrowings ranged from **5.10% to 9.53% per annum**[23](index=23&type=chunk) [Dividends](index=10&type=section&id=III.G.%20Dividends) The Board has declared an interim dividend of 4.4 HK cents per ordinary share for the six months ended June 30, 2025, totaling HKD 22,000 thousand; previously, the company paid a final and special dividend of HKD 27,500 thousand for 2024 Dividends | Dividend Type | Six Months Ended June 30, 2025 (HKD '000) | Six Months Ended June 30, 2024 (HKD '000) | | :--- | :--- | :--- | | Dividends (paid) | 27,500 | 9,990 | | Dividends declared and payable after interim period | 22,000 | 17,000 | - The Board resolved to declare an interim dividend of **4.4 HK cents per ordinary share**, totaling **HKD 22,000 thousand**[25](index=25&type=chunk) [Earnings Per Share](index=11&type=section&id=III.H.%20Earnings%20Per%20Share) For H1 2025, basic and diluted earnings per share were 8.85 HK cents, up from 6.86 HK cents in the prior year, with no potential dilutive ordinary shares Earnings Per Share | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Profit attributable to equity holders of the Company (HKD '000) | 44,230 | 34,307 | | Weighted average number of shares in issue ('000 shares) | 500,000 | 500,000 | | Basic Earnings Per Share (HK cents) | 8.85 | 6.86 | - Diluted earnings per share for the six months ended June 30, 2025, were the same as basic earnings per share, as there were no potential dilutive ordinary shares outstanding during the period[27](index=27&type=chunk) [Income Tax Expense](index=11&type=section&id=III.I.%20Income%20Tax%20Expense) For the six months ended June 30, 2025, Hong Kong profits tax provision was made at a rate of 16.5% - Hong Kong profits tax provision has been made at a rate of **16.5%** on the estimated assessable profit[28](index=28&type=chunk) [Management Discussion and Analysis](index=12&type=section&id=IV.%20Management%20Discussion%20and%20Analysis) [Business Review](index=12&type=section&id=IV.A.%20Business%20Review) The Group provides unsecured loans in Hong Kong, leveraging technology; homeowner loans are key, credit card advances grew, SME loans ceased due to risk, and fintech capabilities are enhanced for efficiency [Loan Business Overview](index=12&type=section&id=IV.A.1.%20Loan%20Business%20Overview) The Group primarily operates unsecured lending in Hong Kong under 'K Cash Express' and 'K Cash' brands, integrating technology for digitalization and automation - The Group primarily engages in lending, specializing in **unsecured loans**, and integrates technology for digitalization and automation[29](index=29&type=chunk) [Unsecured Homeowner Loans](index=12&type=section&id=IV.A.2.%20Unsecured%20Homeowner%20Loans) Unsecured homeowner loans remain the primary revenue source (73.8%), with interest income up 25.4% to HKD 121.4 million and receivables increasing to HKD 1,135.6 million - Unsecured homeowner loans remain the primary revenue source, accounting for approximately **73.8% of revenue**[30](index=30&type=chunk) - Interest income from unsecured homeowner loans increased by **25.4% to HKD 121.4 million**[30](index=30&type=chunk) - Loans receivable increased from **HKD 1,037.0 million to HKD 1,135.6 million**[30](index=30&type=chunk) [Personal Loans and Credit Card Advances](index=12&type=section&id=IV.A.3.%20Personal%20Loans%20and%20Credit%20Card%20Advances) Personal loan interest income rose 9.4% to HKD 36.1 million; credit card advances interest income surged fivefold to HKD 2.7 million, with receivables up 125% due to PayKool card promotion - Interest income from personal loans increased by approximately **9.4% to HKD 36.1 million**[31](index=31&type=chunk) - Interest income from credit card advances increased by approximately **5 times to HKD 2.7 million**[31](index=31&type=chunk) - Credit card advances receivables increased by approximately **125%**, from **HKD 12.0 million to HKD 27.0 million**, due to intensified promotion of PayKool credit cards[31](index=31&type=chunk) [SME Loan Strategy Adjustment](index=13&type=section&id=IV.A.4.%20SME%20Loan%20Strategy%20Adjustment) SME loan interest income decreased 24.4% to HKD 4.4 million, and receivables declined; the company ceased SME lending to focus on homeowner loans and credit cards - Interest income from SME loans decreased by **24.4% to HKD 4.4 million**[32](index=32&type=chunk) - Loans receivable decreased from **HKD 47.2 million to HKD 17.0 million**[32](index=32&type=chunk) - The company has made a strategic decision to **discontinue providing loans to SMEs** and focus resources on unsecured homeowner loans and credit card businesses[33](index=33&type=chunk) [Fintech Development](index=13&type=section&id=IV.A.5.%20Fintech%20Development) The Group enhanced KCash GO repayment module, integrated with bank partners, and upgraded data analytics and PayKool platform use cases to boost cross-selling and up-selling efficiency - Enhanced the KCash GO repayment module, integrating it with additional settlement bank partner systems[33](index=33&type=chunk) - Improved the data analytics platform and activity engine, and introduced customer engagement use cases on the PayKool platform to enhance cross-selling and up-selling efficiency[33](index=33&type=chunk) [Financial Review](index=13&type=section&id=IV.B.%20Financial%20Review) In H1 2025, total interest income grew 21.0%, driven by homeowner loans; other income increased, while interest and G&A expenses rose; net expected credit losses increased, leading to a profit of HKD 44.2 million [Interest Income](index=13&type=section&id=IV.B.1.%20Interest%20Income) In H1 2025, total interest income was HKD 164.5 million (+21.0%), driven by homeowner loans (+25.4% to HKD 121.4 million); personal loan income rose, while SME loan income fell - Total interest income was **HKD 164.5 million**, an increase of **21.0%** compared to the same period last year[34](index=34&type=chunk) - Interest income from unsecured homeowner loans increased by **25.4% to HKD 121.4 million**, primarily due to a **30.5% increase** in average loan balances[34](index=34&type=chunk) - Personal loan interest income increased by **9.4% to HKD 36.1 million**, while SME loan interest income decreased by **24.4% to HKD 4.4 million**[35](index=35&type=chunk) [Other Income](index=13&type=section&id=IV.B.2.%20Other%20Income) In H1 2025, other income was HKD 5.3 million, primarily due to increased credit card issuance and transaction volumes - Other income was **HKD 5.3 million**, mainly due to an increase in the number of credit cards issued and transactions made by credit cardholders during the reporting period[36](index=36&type=chunk) [Interest Expense](index=14&type=section&id=IV.B.3.%20Interest%20Expense) In H1 2025, interest expense was HKD 18.5 million, a 26.9% year-on-year increase, primarily due to an increase in average bank and other borrowings - Interest expense was **HKD 18.5 million**, an increase of **26.9%**, primarily due to the average bank and other borrowings increasing from **HKD 333.5 million to HKD 494.6 million**[37](index=37&type=chunk) [General and Administrative Expenses](index=14&type=section&id=IV.B.4.%20General%20and%20Administrative%20Expenses) In H1 2025, general and administrative expenses were HKD 37.5 million, a 17.1% year-on-year increase, primarily due to higher professional fees and technology-related enhancement expenses - General and administrative expenses were **HKD 37.5 million**, an increase of **17.1%**, primarily due to higher professional fees and technology-related enhancement expenses[38](index=38&type=chunk) [Selling Expenses](index=14&type=section&id=IV.B.5.%20Selling%20Expenses) In H1 2025, selling expenses were HKD 14.9 million, a 4.0% year-on-year decrease, primarily due to a slight reduction in employee benefit expenses - Selling expenses were **HKD 14.9 million**, a decrease of **4.0%**, primarily due to a slight reduction in employee benefit expenses[39](index=39&type=chunk) [Net Expected Credit Losses](index=14&type=section&id=IV.B.6.%20Net%20Expected%20Credit%20Losses) In H1 2025, net expected credit losses were HKD 43.9 million, an increase from the prior year, primarily due to the expanded loan portfolio - Net expected credit losses were **HKD 43.9 million**, with the increase primarily due to the expanded loan portfolio[40](index=40&type=chunk) [Profit for the Period](index=14&type=section&id=IV.B.7.%20Profit%20for%20the%20Period) In H1 2025, profit for the period reached HKD 44.2 million, a significant increase from HKD 34.3 million in the prior year - Profit for the period reached **HKD 44.2 million**, compared to **HKD 34.3 million** in H1 2024[41](index=41&type=chunk) [Liquidity and Financial Resources](index=15&type=section&id=IV.C.%20Liquidity%20and%20Financial%20Resources) The Group's funding channels include institutional loans and operating cash flow; net assets rose to HKD 934.4 million, but cash decreased due to loan advances and interest payments; most balances are in HKD, borrowings in HKD or JPY - Primary funding channels include loans or financing from authorized institutions, cash flows from operating activities, and funding from a Japanese funding provider[42](index=42&type=chunk) - As of June 30, 2025, net assets were **HKD 934.4 million**, and cash and cash equivalents were **HKD 41.6 million** (December 31, 2024: HKD 116.4 million)[43](index=43&type=chunk) - Cash and cash equivalents decreased, primarily due to increased advances to customers and interest payments on bank and other borrowings[43](index=43&type=chunk) - Most cash and bank balances are denominated in **HKD**, while borrowings are denominated in **HKD or JPY**[44](index=44&type=chunk) [Capital Structure and Treasury Policy](index=15&type=section&id=IV.D.%20Capital%20Structure%20and%20Treasury%20Policy) The company maintains prudent financial management and monitors liquidity; as of June 30, 2025, unutilized bank facilities were HKD 190.0 million, with borrowings used for working capital and secured by loans - The Company adopts a prudent financial management approach for its treasury policy, closely monitoring its liquidity position[45](index=45&type=chunk) - As of June 30, 2025, unutilized bank facilities available to the Group amounted to **HKD 190.0 million**[45](index=45&type=chunk) - Bank and other borrowings of **HKD 481.2 million** are used as working capital, with interest rates ranging from **5.10% to 9.53% per annum**[45](index=45&type=chunk) - All bank and other borrowings are repayable on demand and secured by loans and interest receivables[46](index=46&type=chunk) [Key Operating Data](index=16&type=section&id=IV.E.%20Key%20Operating%20Data) As of June 30, 2025, total loans increased to HKD 1,429.0 million, with unsecured homeowner loans accounting for 79.4%; average loan size and tenure varied, and total impairment allowance was HKD 110,813 thousand [Loan Portfolio Breakdown](index=16&type=section&id=IV.E.1.%20Loan%20Portfolio%20Breakdown) As of June 30, 2025, total loans were HKD 1,429.0 million, with 12,791 accounts; homeowner loans accounted for 79.4%, and credit card advances increased to 1.9% Loan Portfolio Breakdown | Loan Type | Number of Loan Accounts (June 30, 2025) | Amount (HKD million, June 30, 2025) | % (June 30, 2025) | Number of Loan Accounts (December 31, 2024) | Amount (HKD million, December 31, 2024) | % (December 31, 2024) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Unsecured Homeowner Loans | 3,027 | 1,135.6 | 79.4 | 2,899 | 1,037.0 | 76.8 | | Personal Loans | 5,345 | 249.4 | 17.5 | 5,281 | 253.1 | 18.8 | | Credit Card Advances | 4,394 | 27.0 | 1.9 | 1,385 | 12.0 | 0.9 | | SME Loans | 25 | 17.0 | 1.2 | 38 | 47.2 | 3.5 | | **Total** | **12,791** | **1,429.0** | **100.0** | **9,603** | **1,349.3** | **100.0** | [Average Loan Size](index=16&type=section&id=IV.E.2.%20Average%20Loan%20Size) For H1 2025, the overall average loan size was HKD 174.1 thousand, with SME loans having the largest average size at HKD 2,193.1 thousand Average Loan Size | Loan Type | Six Months Ended June 30, 2025 (HKD '000) | Year Ended December 31, 2024 (HKD '000) | | :--- | :--- | :--- | | Unsecured Homeowner Loans | 384.1 | 372.0 | | Personal Loans | 58.9 | 66.2 | | SME Loans | 2,193.1 | 1,475.5 | | **Overall** | **174.1** | **155.4** | [Average Loan Tenure](index=16&type=section&id=IV.E.3.%20Average%20Loan%20Tenure) As of June 30, 2025, the average tenure for unsecured homeowner loans was 60.4 months, while personal and SME loan tenures shortened Average Loan Tenure | Loan Type | June 30, 2025 (Months) | December 31, 2024 (Months) | | :--- | :--- | :--- | | Unsecured Homeowner Loans | 60.4 | 49.8 | | Personal Loans | 21.1 | 29.5 | | SME Loans | 24.1 | 37.7 | | **Overall** | **35.3** | **36.1** | [Aging Analysis of Loans and Advances (by Installment Due Date)](index=17&type=section&id=IV.E.4.%20Aging%20Analysis%20of%20Loans%20and%20Advances%20(by%20Installment%20Due%20Date)) As of June 30, 2025, most loans remain current, with unsecured homeowner loans having a current portion of HKD 942,025 thousand; overdue over 90 days for SME loans significantly decreased Loans and Advances Aging Analysis (by Installment Due Date) | Loan Type | Aging | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | | :--- | :--- | :--- | :--- | | Unsecured Homeowner Loans | Current | 942,025 | 846,387 | | | Overdue over 90 days | 171,328 | 167,963 | | Personal Loans | Current | 231,509 | 237,146 | | | Overdue over 90 days | 11,484 | 10,911 | | Credit Card Advances | Current | 26,188 | 11,853 | | | Overdue over 90 days | 339 | 65 | | SME Loans | Current | 12,132 | 23,025 | | | Overdue over 90 days | 3,200 | 21,590 | [Impairment Allowance Breakdown](index=17&type=section&id=IV.E.5.%20Impairment%20Allowance%20Breakdown) As of June 30, 2025, total impairment allowance was HKD 110,813 thousand, with unsecured homeowner loans accounting for HKD 20,212 thousand Impairment Allowance Breakdown | Loan Type | June 30, 2025 (HKD '000) | December 31, 2024 (HKD '000) | | :--- | :--- | :--- | | Unsecured Homeowner Loans | 20,212 | 21,930 | | Personal Loans | 65,115 | 72,034 | | Credit Card Advances | 7,060 | 1,789 | | SME Loans | 9,789 | 29,819 | | **Total** | **110,813** | **116,935** | [Key Financial Ratios](index=18&type=section&id=IV.F.%20Key%20Financial%20Ratios) As of June 30, 2025, the debt-to-equity ratio was 0.51, and the interest coverage ratio was 3.8 times, consistent with the prior year Key Financial Ratios | Financial Ratio | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Debt-to-Equity Ratio | 0.51 | 0.45 | Key Financial Ratios | Financial Ratio | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Interest Coverage Ratio | 3.8 times | 3.8 times | - Debt-to-equity ratio is calculated as net debt divided by total equity[56](index=56&type=chunk) - Interest coverage ratio is calculated as profit before tax and interest divided by interest expense[56](index=56&type=chunk) [Outlook and Prospects](index=18&type=section&id=IV.G.%20Outlook%20and%20Prospects) Unsecured loan market is expected to grow with property market recovery, and credit card business continues significant growth; the company will invest in AI and data analytics to enhance efficiency and customer experience, launching new platform features and implementing generative AI for automation [Market Recovery and Growth Drivers](index=18&type=section&id=IV.G.1.%20Market%20Recovery%20and%20Growth%20Drivers) Unsecured loan market is expected to be driven by property market recovery, rising credit financing demand, and digital transformation; credit cardholders significantly increased by 133% to 4,464, indicating sustained growth in this business - The unsecured loan market is expected to be driven by property market recovery, rising credit financing demand, and digital transformation of financial services[54](index=54&type=chunk) - The number of credit cardholders significantly increased by approximately **133% to 4,464**, indicating substantial and sustained growth in the credit card business[54](index=54&type=chunk) [Technology and AI Investment](index=18&type=section&id=IV.G.2.%20Technology%20and%20AI%20Investment) Innovative AI and data analytics are expected to enhance operational efficiency and customer experience; the company will continue to invest in advanced systems and digital platforms to streamline processes and ensure customer data security - Innovative artificial intelligence and data analytics are expected to enhance operational efficiency and customer experience[55](index=55&type=chunk) - The company continuously invests in advanced systems and digital platforms to streamline processes, provide a seamless customer experience, and ensure the security and privacy of customer data[55](index=55&type=chunk) [Future Platform Features and Efficiency Enhancement](index=19&type=section&id=IV.G.3.%20Future%20Platform%20Features%20and%20Efficiency%20Enhancement) In H2 2025, KCash will launch smart credit assessment, PayKool will enhance credit card advances and introduce smart credit alerts; the company will also implement generative AI internally for automation - The KCash platform will launch a smart credit assessment report feature, offering free instant credit score evaluations[57](index=57&type=chunk) - The PayKool platform will enhance credit card advance features and introduce smart credit alert functions[57](index=57&type=chunk) - The company is developing initiatives for multiple generative AI use cases and gradually implementing them internally to automate routine tasks and enhance corporate efficiency[57](index=57&type=chunk) [Other Information](index=19&type=section&id=V.%20Other%20Information) [Significant Acquisitions and Disposals](index=19&type=section&id=V.A.%20Significant%20Acquisitions%20and%20Disposals) During the reporting period, the Group did not undertake any significant acquisitions or disposals of assets - During the reporting period, the Group did not undertake any significant acquisitions or disposals of subsidiaries, associates, or joint ventures[58](index=58&type=chunk) [Material Investments](index=19&type=section&id=V.B.%20Material%20Investments) During the reporting period, the Group had no material investments and currently has no plans for future material investments or capital assets - During the reporting period, the Group had no material investments[59](index=59&type=chunk) - As of the date of this announcement, the Group has no future plans regarding material investments or capital assets[59](index=59&type=chunk) [Pledge of Assets](index=19&type=section&id=V.C.%20Pledge%20of%20Assets) As of June 30, 2025, loans receivable totaling HKD 806.2 million were pledged as collateral for bank and other borrowings - As of June 30, 2025, certain loans receivable totaling **HKD 806.2 million** were pledged as collateral for bank and other borrowings[60](index=60&type=chunk) [Foreign Exchange Risk](index=19&type=section&id=V.D.%20Foreign%20Exchange%20Risk) The Group's business is in HKD, with foreign exchange risk mainly from JPY borrowings; risk is managed by reviewing exposure, monitoring rates, and using forward foreign exchange contracts for hedging - The Group's business activities are denominated in **HKD**, with foreign exchange risk primarily arising from **JPY-denominated borrowings**[61](index=61&type=chunk) - The Group has arranged forward foreign exchange contracts to hedge against foreign exchange risk arising from funding from a Japanese funding provider[61](index=61&type=chunk) [Employees and Remuneration Policy](index=20&type=section&id=V.E.%20Employees%20and%20Remuneration%20Policy) As of June 30, 2025, the Group employed 67 staff, with employee benefit expenses of HKD 20.0 million; remuneration policy covers position, responsibilities, and performance - As of June 30, 2025, the Group employed **67 staff** (December 31, 2024: 61 staff)[62](index=62&type=chunk) - During the reporting period, employee benefit expenses amounted to **HKD 20.0 million**[62](index=62&type=chunk) - The remuneration policy covers employee position, responsibilities, and performance, including salaries, overtime allowances, bonuses, and various subsidies[62](index=62&type=chunk) [Employee Training Programs](index=20&type=section&id=V.F.%20Employee%20Training%20Programs) The Group values employee sustainable development, continuously improving its internal staff training system and formulating specific training and development plans to enhance skills - The Group values employee sustainable development, continuously improving its internal staff training system and formulating specific training and development plans[63](index=63&type=chunk) [Contingent Liabilities](index=20&type=section&id=V.G.%20Contingent%20Liabilities) As of June 30, 2025, the Group had no material contingent liabilities - As of June 30, 2025, the Group had no material contingent liabilities[64](index=64&type=chunk) [Interim Dividend](index=20&type=section&id=V.H.%20Interim%20Dividend) The Board resolved to declare an interim dividend of 4.4 HK cents per share for the six months ended June 30, 2025 - The Board resolved to declare an interim dividend of **4.4 HK cents per share** for the six months ended June 30, 2025[65](index=65&type=chunk) [Corporate Governance](index=20&type=section&id=V.I.%20Corporate%20Governance) The Group is committed to high corporate governance standards and complied with all applicable code provisions of the Corporate Governance Code throughout the reporting 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 throughout the reporting period[66](index=66&type=chunk) [Standard Code for Securities Transactions](index=21&type=section&id=V.J.%20Standard%20Code%20for%20Securities%20Transactions) The Company adopted the Standard Code for securities transactions by directors and employees, with all directors confirming full compliance during the reporting period - The Company has adopted the Standard Code as the code of conduct for securities transactions by its Directors and relevant employees of the Group[67](index=67&type=chunk) - All Directors have confirmed their full compliance with the Standard Code during the reporting period[67](index=67&type=chunk) [Audit Committee Review of Results](index=21&type=section&id=V.K.%20Audit%20Committee%20Review%20of%20Results) The Audit Committee reviewed the Group's unaudited interim results for H1 2025, discussing accounting principles, financial reporting, and internal controls with management, with no disagreements - The Audit Committee has reviewed the Group's unaudited interim condensed consolidated results for the six months ended June 30, 2025, with no disagreements[68](index=68&type=chunk) [No Material Changes](index=21&type=section&id=V.L.%20No%20Material%20Changes) Except as disclosed, there were no material changes affecting the Group's performance during the reporting period - During the reporting period, there were no material changes affecting the Group's performance that require disclosure under paragraphs 32, 40(2), and 46(3) of Appendix D2 to the Listing Rules[69](index=69&type=chunk) [Events After Reporting Period](index=21&type=section&id=V.M.%20Events%20After%20Reporting%20Period) From June 30, 2025, up to the date of this announcement, there have been no material events affecting the Group - From June 30, 2025, up to the date of this announcement, there have been no material events affecting the Group[70](index=70&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=21&type=section&id=V.N.%20Purchase,%20Sale%20or%20Redemption%20of%20the%20Company's%20Listed%20Securities) During the reporting period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - During the reporting period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[71](index=71&type=chunk) [Compliance with Laws and Regulations](index=21&type=section&id=V.O.%20Compliance%20with%20Laws%20and%20Regulations) The Group complied with all material laws and regulations affecting its money lending business, and Directors are unaware of any matters that could revoke its license - The Group has complied in all material respects with all laws and regulations significantly affecting its money lending business during the reporting period[72](index=72&type=chunk) - The Directors are unaware of any matters that could lead to the revocation of the money lender's license before its expiry date[72](index=72&type=chunk) [Use of Proceeds from Global Offering](index=22&type=section&id=V.P.%20Use%20of%20Proceeds%20from%20Global%20Offering) Net proceeds of HKD 181.2 million from the global offering will continue to be used as outlined in the prospectus; HKD 4.2 million was used for technology, with the remaining HKD 18.5 million expected by December 2026 - Net proceeds from the global offering were approximately **HKD 181.2 million**, which will continue to be used for the same purposes outlined in the prospectus[73](index=73&type=chunk) Use of Proceeds from Global Offering | Purpose | Planned Application (HKD million) | Amount Utilized as of June 30, 2025 (HKD million) | Expected Timeline for Full Utilization of Remaining Unutilized Net Proceeds | | :--- | :--- | :--- | :--- | | Enhance technological capabilities | 30.6 | 4.2 | By December 2026 | | Expand loan portfolio | 133.6 | – | – | | General working capital and general corporate purposes | 17.0 | – | – | | **Total** | **181.2** | **4.2** | | [Suspension of Share Register Closure](index=22&type=section&id=V.Q.%20Suspension%20of%20Share%20Register%20Closure) To determine interim dividend eligibility, share transfer registration will be suspended from September 3-5, 2025; record date is September 5, 2025, with payment expected on September 12, 2025 - The Company will suspend share transfer registration from **September 3 to September 5, 2025**[75](index=75&type=chunk) - The record date is **September 5, 2025**, and the interim dividend is expected to be paid on **September 12, 2025**[75](index=75&type=chunk) [Publication of Interim Results and Interim Report](index=22&type=section&id=V.R.%20Publication%20of%20Interim%20Results%20and%20Interim%20Report) This announcement and the interim report will be published in due course on the HKEX website and the Company's website - This announcement and the interim report will be published in due course on the HKEX website (www.hkexnews.hk) and the Company's website (www.kcash.hk)[76](index=76&type=chunk) [Definitions and Board Information](index=23&type=section&id=VI.%20Definitions%20and%20Board%20Information) [Definitions](index=23&type=section&id=VI.A.%20Definitions) This section provides definitions for key terms used in the report, including 'Listing Rules', 'Reporting Period', 'Shares', and 'Corporate Governance Code' - Reporting Period refers to the six months ended **June 30, 2025**[78](index=78&type=chunk) - Unsecured homeowner loans refer to unsecured loans provided by the Group to borrowers who are property owners but have not provided any collateral for the loans[83](index=83&type=chunk) [Board Information](index=24&type=section&id=VI.B.%20Board%20Information) This section lists the members of the Company's Board of Directors as of the announcement date, including executive, non-executive, and independent non-executive directors - As of the date of this announcement, the Company's Board of Directors includes Executive Directors Mr. Li Kun Tai and Ms. Wong Cheuk Sze, Non-executive Directors Mr. Li Sheung Shing, Ms. Li Bik Chung, Ms. Chan Wing Sze and Ms. Kan Pui Yan, and Independent Non-executive Directors Professor Hon Wai Ming, JP, Mr. Mak Wing Sum and Mr. Leung Ka Cheong[82](index=82&type=chunk)

[Financial Highlights](index=1&type=section&id=Financial%20Highlights) [Interim Financial Highlights](index=1&type=section&id=Interim%20Financial%20Highlights) WuXi Biologics demonstrated strong performance in the first half of 2025, with revenue increasing by **16.1%** to **RMB 9.95 billion** and net profit surging by **54.8%** to **RMB 2.76 billion**, alongside significant improvements in gross and net profit margins and a **56.8%** rise in basic earnings per share | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Revenue | 9,953.2 | 8,574.2 | 16.1% | | Gross Profit | 4,252.9 | 3,350.0 | 27.0% | | Gross Margin | 42.7% | 39.1% | +3.6% | | Net Profit | 2,756.6 | 1,780.3 | 54.8% | | Net Margin | 27.7% | 20.8% | +6.9% | | Net Profit Attributable to Owners of the Company | 2,339.3 | 1,499.1 | 56.0% | | Net Margin Attributable to Owners of the Company | 23.5% | 17.5% | +6.0% | | Basic EPS (RMB) | 0.58 | 0.37 | 56.8% | | Diluted EPS (RMB) | 0.55 | 0.35 | 57.1% | - The Board has resolved not to declare any interim dividend for the six months ended June 30, 2025[3](index=3&type=chunk) [Management Discussion and Analysis](index=2&type=section&id=Management%20Discussion%20and%20Analysis) [Business Review](index=2&type=section&id=Business%20Review) WuXi Biologics achieved robust growth in H1 2025, driven by its unique CRDMO platform and "Follow-the-Molecule" strategy, reaching a record **864 integrated projects** and increasing total backlog to **USD 20.3 billion**, while expanding its client base and strengthening partnerships with top global pharmaceutical companies [Overall Performance](index=2&type=section&id=Overall%20Performance) During the reporting period, WuXi Biologics added **86 new integrated projects**, bringing the total to **864**, including **429 preclinical**, **344 early-phase clinical**, **67 late-phase clinical**, and **24 commercial manufacturing projects**, while securing **9 external projects** through its "Win-the-Molecule" strategy - The Group's business maintained robust growth and achieved excellent results, leveraging its unique integrated CRDMO platform and "Follow-the-Molecule" strategy[4](index=4&type=chunk) | Project Stage | New Projects H1 2025 | Total Projects as of June 30, 2025 | | :--- | :--- | :--- | | Integrated Projects | 86 | 864 | | Preclinical Projects | - | 429 | | Early-Phase Clinical Projects (Phase I/II) | - | 344 | | Late-Phase Clinical Projects (Phase III) | - | 67 | | Commercial Manufacturing Projects | - | 24 | | External Projects (Win-the-Molecule) | 9 (including 2 late-phase clinical) | - | - Total backlog increased to **USD 20.3 billion** as of June 30, 2025, comprising **USD 11.4 billion** in service backlog and **USD 9.0 billion** in potential milestone payment backlog[7](index=7&type=chunk) [CRDMO Platform - Research (R)](index=4&type=section&id=CRDMO%20Platform%20%E2%80%94%20Research%20%28R%29) The Global Biologics Research (GBR) business unit, comprising approximately **800 scientists**, offers comprehensive and efficient one-stop biologics discovery solutions, including standalone, modular, and fully integrated project services, while continuously enhancing capabilities in multispecific antibodies, protein production, and bispecific antibodies, and establishing strategic collaborations with global partners like GSK and BioNTech - The GBR business unit, composed of approximately **800 scientists**, provides comprehensive and efficient one-stop biologics discovery solutions, supporting the entire process from initial concept to IND filing[10](index=10&type=chunk) - Leveraging VHH library technology, the WuXiBody™ platform, and protein engineering expertise, the company continuously empowers clients to develop multispecific and bispecific antibodies, with over **50 WuXiBody™ collaborations** globally[11](index=11&type=chunk)[12](index=12&type=chunk) - Strategic collaborations have been established with global partners such as GSK plc and Candid Therapeutics, with one molecule developed for GSK plc entering clinical trials, becoming the **fourth WuXi Biologics-derived TCE** to reach this stage[13](index=13&type=chunk) [CRDMO Platform - Development (D)](index=5&type=section&id=CRDMO%20Platform%20%E2%80%94%20Development%20%28D%29) WuXi Biologics' biologics development team is dedicated to shortening project development cycles, having enabled over **660 IND filing projects** through advanced technologies like the WuXia™ cell line development platform, WuXiUP™ ultra-high productivity continuous manufacturing process platform, WuXiUI™ bioprocess platform, and WuXiHigh™ high-concentration formulation development platform, continuously optimizing delivery times and ensuring quality - The development cycle from DNA to IND has been reduced to just **nine months**, enabling over **660 IND filing projects** by the end of the reporting period[15](index=15&type=chunk) - The WuXia™ platform can enable **150 integrated CMC projects annually**, having delivered over **1,000 cell lines** and expanded to include WuXia RidGS™ and WuXiaADCC PLUS™ platforms[15](index=15&type=chunk) - The WuXiUP™ platform utilizes **1,000 to 2,000-liter single-use bioreactors** to achieve batch yields equivalent to **10,000 to 20,000-liter stainless steel reactors**, having developed over **170 processes** for more than **60 molecules**[16](index=16&type=chunk) - The WuXiHigh™ 2.0 platform achieves protein concentrations of up to **230 mg/mL** and reduces viscosity by up to **90%**, providing customized solutions for over **110 projects**[18](index=18&type=chunk) [CRDMO Platform - Manufacturing (M)](index=8&type=section&id=CRDMO%20Platform%20%E2%80%94%20Manufacturing%20%28M%29) WuXi Biologics' biologics cGMP drug substance facilities fully utilize single-use bioreactors and have upgraded to one-stop integrated drug product solutions, with late-phase clinical and commercial manufacturing projects continuously growing under the "Follow-the-Molecule" and "Global Dual Sourcing" strategies, achieving over **98% PPQ batch success rate** and successfully completing PPQ production for the first commercial project on Asia's first **5,000-liter single-use drug substance production line** - Biologics cGMP drug substance facilities fully utilize single-use bioreactors and have upgraded to one-stop integrated drug product solutions[19](index=19&type=chunk) - The number of late-phase clinical and commercial manufacturing projects continued to grow steadily, reaching **67 and 24 projects**, respectively, by the end of the reporting period, with **2 "Win-the-Molecule" late-phase clinical projects** secured[21](index=21&type=chunk) - Drug substance and drug product manufacturing facilities achieved a PPQ batch success rate of over **98%**, with **25 PPQs** expected to be completed as scheduled in 2025[21](index=21&type=chunk) - The three sets of **5,000-liter single-use bioreactors** on the second drug substance production line at the Hangzhou MFG20 facility successfully completed PPQ production for the first commercial project, marking a significant breakthrough as Asia's first **5,000-liter single-use drug substance production line**[21](index=21&type=chunk) [Integrated Platform Ecosystem for Advanced Modalities](index=9&type=section&id=Integrated%20Platform%20Ecosystem%20for%20Advanced%20Modalities) WuXi Biologics has successfully built an integrated platform ecosystem for advanced therapeutic modalities, significantly expanding its service scope, with its subsidiary WuXi XDC excelling in ADC and bioconjugate drugs, and its microbial and HEK293 platforms continuously providing comprehensive end-to-end solutions for the development and manufacturing of various technology modalities - WuXi XDC (stock code: 2268) has secured **225 ongoing ADC and other bioconjugate iCMC projects** globally, with **37** of them in Phase II and late-phase stages[24](index=24&type=chunk) - The microbial platform launched the EffiX™ expression platform, enabling high-yield, high-quality, highly stable, and scalable R&D and manufacturing of microbial-derived biologics, supporting various technology modalities such as antibody fragments, enzymes, VLPs, and pDNA[24](index=24&type=chunk) - The HEK293 platform for recombinant protein expression (WuXia293Stable brand) has been successfully established, addressing the challenge of expressing complex molecules in CHO cell lines and producing proteins with humanized post-translational modifications[27](index=27&type=chunk) [Quality](index=10&type=section&id=Quality) WuXi Biologics prioritizes quality, having successfully completed **44 national regulatory inspections** since 2017 (including **22 EU EMA and US FDA inspections**) without major findings or data integrity issues, and its **five manufacturing facilities**, including the first commercial PFS filling plant DP5, successfully passed US FDA PLI inspections, solidifying a **100% PLI pass rate** record - Since 2017, **44 national regulatory inspections** (including **22 EU EMA and US FDA inspections**) have been successfully completed without any major findings or data integrity issues[25](index=25&type=chunk) - Five manufacturing facilities, including the first commercial PFS filling plant DP5, successfully passed US FDA Pre-License Inspections (PLI) without any critical findings or data integrity issues, solidifying an excellent record of **100% PLI pass rate**[25](index=25&type=chunk) [Sustainability](index=10&type=section&id=Sustainability) WuXi Biologics integrates sustainability as a cornerstone of its business strategy, committed to enhancing ESG performance and providing end-to-end green solutions, having joined SBTi, UNGC, and PSCI, and receiving recognition from multiple ESG rating agencies, including DJSI, MSCI ESG AAA rating, Sustainalytics Negligible Risk rating, EcoVadis Platinum rating, and CDP A- climate change leadership score - Sustainability is considered a cornerstone of the business strategy, with a commitment to enhancing ESG performance and providing end-to-end green solutions[26](index=26&type=chunk) - The company has joined the Science Based Targets initiative (SBTi), the United Nations Global Compact (UNGC), and the Pharmaceutical Supply Chain Initiative (PSCI)[28](index=28&type=chunk) - Received recognition from multiple ESG rating agencies, including selection for the Dow Jones Sustainability Index (DJSI), MSCI ESG **AAA rating**, Sustainalytics' highest ESG rating (Negligible Risk), EcoVadis **Platinum rating**, and a CDP **A- climate change leadership score**[28](index=28&type=chunk) [Regional Operations](index=11&type=section&id=Regional%20Operations) WuXi Biologics' manufacturing network spans multiple locations, implementing a "Global Dual Sourcing" strategy to continuously enhance capacity, with the Chengdu microbial commercial manufacturing base construction initiated, Ireland's MFG6 Phase II capacity expanded and PPQ production completed, MFG7 completing its second **12,000-liter scale PPQ production** with products approved by EU EMA, MFG11 engineering construction progressing in Worcester, USA, and a new modular biologics manufacturing plant initiated in Singapore - Signed two facility asset divestiture transactions (German drug product facility and WuXi Vaccines Ireland facility) to optimize global operational efficiency and asset utilization[29](index=29&type=chunk) - Construction of a new microbial commercial manufacturing base in Chengdu, China, has commenced, which will be equipped with **15,000-liter fermenters** and have an annual drug substance capacity of **80 to 110 batches**[30](index=30&type=chunk) - Europe's Ireland MFG6 Phase II capacity increased to **6,000 liters**, completing its first engineering batch and PPQ production; MFG7 completed its second **12,000-liter scale PPQ production**, with products approved by EU EMA[30](index=30&type=chunk) - Engineering construction for MFG11 in Worcester, Massachusetts, USA, continues to advance, with **six 6,000-liter single-use bioreactors** to be installed; a new modular biologics manufacturing plant has commenced construction in Singapore, and WuXi XDC's Singapore manufacturing base achieved mechanical completion[33](index=33&type=chunk) [WBS (WuXi Biologics Lean Operating Management System)](index=13&type=section&id=WBS%20%EF%BC%88WuXi%20Biologics%20Lean%20Operating%20Management%20System%EF%BC%89) WuXi Biologics introduced the WBS Lean Operating Management System in 2021 to drive business improvement by enhancing efficiency, quality, accelerating delivery, and reducing costs, completing approximately **130 improvement projects** during the reporting period, effectively advancing strategic execution, strengthening risk and inventory control, optimizing business operational efficiency, and significantly enhancing core competitiveness - The WBS Lean Operating Management System was introduced in 2021, aiming to drive business improvement by enhancing efficiency and quality, accelerating delivery, and reducing costs[34](index=34&type=chunk) - Approximately **130 improvement projects** were completed during the reporting period, effectively advancing strategic execution, strengthening risk and inventory control, optimizing business operational efficiency, and significantly enhancing core competitiveness[34](index=34&type=chunk) [Future Outlook](index=13&type=section&id=Future%20Outlook) WuXi Biologics remains resilient amidst macroeconomic fluctuations and complex tariff environments, committed to enabling the entire biologics process from concept to manufacturing, as the biopharmaceutical industry maintains strong growth driven by increasing demand for advanced biotherapies and breakthroughs in next-generation modalities like bispecific antibodies, multispecific antibodies, and ADCs, with the company expecting to continue benefiting from the growth in biologics outsourcing services and planning to further enhance its integrated platform, strengthen capacity, and drive operational excellence through WBS and digitalization initiatives in H2 2025 - The company remained steadfast amidst macroeconomic fluctuations, successfully navigating complex tariff environments without any impact on its business[35](index=35&type=chunk) - The biopharmaceutical industry maintains strong growth due to demand for advanced biotherapies (oncology, autoimmune disorders, chronic disease management) and breakthroughs in next-generation technology modalities (bispecific antibodies, multispecific antibodies, ADCs)[35](index=35&type=chunk) - Biopharmaceutical and biotechnology companies are expected to continue demanding integrated outsourcing services from early research to commercial manufacturing[37](index=37&type=chunk) - In H2 2025, the company will continue to focus on enhancing its integrated platform, strengthening capacity, and driving operational excellence through WBS lean implementation and digitalization initiatives[38](index=38&type=chunk) [Financial Review](index=15&type=section&id=Financial%20Review) [Revenue](index=15&type=section&id=Revenue) WuXi Biologics' revenue grew by **16.1%** to **RMB 9.95 billion** in H1 2025, primarily driven by the successful execution of the "Follow-the-Molecule" strategy, expansion of technology platforms like ADC and bispecific antibodies, growth in research service revenue, and utilization of existing and new capacities | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Revenue | 9,953.2 | 8,574.2 | 16.1% | - Revenue growth was primarily attributed to the successful execution of the "Follow-the-Molecule" strategy, expansion of technology platforms such as ADC and bispecific antibodies, growth in research service revenue, and utilization of existing and new capacities[39](index=39&type=chunk) [Revenue by Region](index=15&type=section&id=Revenue%20by%20Region) WuXi Biologics' revenue exhibits global diversification, with North America contributing the largest share at **60.5%**, growing by **20.1%**, while Europe accounted for **19.8%** with **5.7% growth**, China's revenue decreased by **8.5%** to **13.0%** of the total, and other regions of the world saw a significant **136.8%** increase | Region | H1 2025 (RMB million) | Share | H1 2024 (RMB million) | Share | Change | | :--- | :--- | :--- | :--- | :--- | :--- | | North America | 6,018.1 | 60.5% | 5,009.7 | 58.4% | 20.1% | | Europe | 1,968.6 | 19.8% | 1,863.0 | 21.7% | 5.7% | | China | 1,297.0 | 13.0% | 1,417.9 | 16.6% | -8.5% | | Rest of World | 669.5 | 6.7% | 283.6 | 3.3% | 136.8% | | **Total** | **9,953.2** | **100.0%** | **8,574.2** | **100.0%** | **16.1%** | [Revenue by Service Type](index=16&type=section&id=Revenue%20by%20Service%20Type) In H1 2025, pre-IND service revenue grew by **35.2%** to **RMB 4.15 billion**, accounting for **41.7%** of total revenue, while late-phase (Phase III) clinical development services and commercial manufacturing revenue increased by **24.9%** to **RMB 4.29 billion**, representing **43.1%** of total revenue, and early-phase (Phase I & II) clinical development service revenue decreased | Service Type | H1 2025 (RMB million) | Share | H1 2024 (RMB million) | Share | Change | | :--- | :--- | :--- | :--- | :--- | :--- | | Pre-IND Services | 4,147.3 | 41.7% | 3,068.0 | 35.8% | 35.2% | | Early-Phase (Phase I & II) Clinical Development Services | 1,330.1 | 13.3% | 1,893.0 | 22.1% | -29.7% | | Late-Phase (Phase III) Clinical Development Services and Commercial Manufacturing | 4,288.9 | 43.1% | 3,434.4 | 40.0% | 24.9% | | Others | 186.9 | 1.9% | 178.8 | 2.1% | 4.5% | | **Total** | **9,953.2** | **100.0%** | **8,574.2** | **100.0%** | **16.1%** | [Revenue by Segment](index=16&type=section&id=Revenue%20by%20Segment) WuXi Biologics comprises two main business segments, Biologics and XDC, with H1 2025 external sales revenue for the Biologics segment at **RMB 7.28 billion** and for the XDC segment at **RMB 2.67 billion**, demonstrating significant growth in the XDC segment | Segment | H1 2025 External Sales (RMB million) | H1 2024 External Sales (RMB million) | | :--- | :--- | :--- | | Biologics | 7,281.0 | 6,961.6 | | XDC | 2,672.2 | 1,612.6 | - The XDC segment is dedicated to providing CRDMO services for ADCs and various bioconjugate drugs, while the Biologics segment continues to engage in the discovery, development, and manufacturing of biologics[42](index=42&type=chunk) [Cost of Sales](index=17&type=section&id=Cost%20of%20Sales) Cost of sales increased by **9.1%** to **RMB 5.70 billion** in H1 2025, consistent with revenue growth, primarily comprising direct employee costs, raw material costs, and overheads | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Cost of Sales | 5,700.4 | 5,224.3 | 9.1% | - The increase in cost of sales is consistent with revenue growth, primarily comprising direct employee costs, raw material costs, and overheads[43](index=43&type=chunk) [Gross Profit and Gross Margin](index=17&type=section&id=Gross%20Profit%20and%20Gross%20Margin) Gross profit increased by **27.0%** to **RMB 4.25 billion** in H1 2025, with gross margin improving from **39.1% to 42.7%**, primarily due to cost savings and efficiency improvements achieved through WuXi Biologics' Lean Operating Management System (WBS) and digitalization initiatives | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Gross Profit | 4,252.9 | 3,350.0 | 27.0% | | Gross Margin | 42.7% | 39.1% | +3.6% | - The improvement in gross margin is primarily attributed to cost savings and efficiency improvements achieved through WBS and digitalization initiatives[44](index=44&type=chunk) [Other Income](index=18&type=section&id=Other%20Income) Other income slightly decreased by **3.6%** to **RMB 326.4 million** in H1 2025, primarily due to a slight decline in research and other grants and interest income | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Other Income | 326.4 | 338.7 | -3.6% | - The slight decrease in other income was primarily due to a slight decline in research and other grants and interest income[46](index=46&type=chunk) [Impairment Losses under Expected Credit Loss Model (Net of Reversals)](index=18&type=section&id=Impairment%20Losses%20under%20Expected%20Credit%20Loss%20Model%20%28Net%20of%20Reversals%29) Impairment losses (net of reversals) decreased by **29.7%** to **RMB 133.8 million** in H1 2025, primarily attributed to management's continuous implementation of stringent credit control measures | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Impairment Losses | 133.8 | 190.2 | -29.7% | - The decrease in impairment losses was primarily attributed to management's continuous implementation of stringent credit control measures[47](index=47&type=chunk) [Other Gains and Losses](index=18&type=section&id=Other%20Gains%20and%20Losses) H1 2025 saw net other gains of **RMB 361.0 million**, primarily from net gains on equity investments and asset disposals, contrasting with net other losses of **RMB 81.9 million** in the prior period, mainly due to unrealized foreign exchange translation losses | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | | :--- | :--- | :--- | | Other Gains and Losses | 361.0 (Net Gain) | -81.9 (Net Loss) | - H1 2025 primarily benefited from net gains on equity investments and asset disposals, while H1 2024 was mainly impacted by unrealized foreign exchange translation losses[48](index=48&type=chunk) [Selling and Marketing Expenses](index=19&type=section&id=Selling%20and%20Marketing%20Expenses) Selling and marketing expenses increased by **21.1%** to **RMB 270.1 million** in H1 2025, primarily due to continuous investment in talent acquisition and retention to enhance business development capabilities, with the percentage of revenue slightly increasing to **2.7%** | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Selling and Marketing Expenses | 270.1 | 223.1 | 21.1% | | As % of Revenue | 2.7% | 2.6% | +0.1% | - The increase is attributed to continuous investment in talent acquisition and retention to enhance business development capabilities in the global market[49](index=49&type=chunk) [Administrative Expenses](index=19&type=section&id=Administrative%20Expenses) Administrative expenses were approximately **RMB 781.1 million** in H1 2025, remaining relatively stable compared to the prior period | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Administrative Expenses | 781.1 | 773.0 | 1.0% | [Research and Development Expenses](index=19&type=section&id=Research%20and%20Development%20Expenses) Research and development expenses were approximately **RMB 343.5 million** in H1 2025, consistent with the prior period | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Research and Development Expenses | 343.5 | 344.1 | -0.2% | [Finance Costs](index=19&type=section&id=Finance%20Costs) Finance costs increased by **22.6%** to **RMB 83.5 million** in H1 2025, primarily due to reduced capitalized interest expenses from project completion, partially offset by lower average bank borrowing balances and reduced interest expenses on the financing component of customer advances | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Finance Costs | 83.5 | 68.1 | 22.6% | - The increase in finance costs was primarily due to reduced capitalized interest expenses from project completion, partially offset by lower average bank borrowing balances and reduced interest expenses on the financing component of customer advances[52](index=52&type=chunk) [Income Tax Expense](index=20&type=section&id=Income%20Tax%20Expense) Income tax expense increased by **150.5%** to **RMB 571.5 million** in H1 2025, primarily due to higher profit before tax and reduced tax refunds, with the effective income tax rate remaining stable at **18.5%** | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Income Tax Expense | 571.5 | 228.1 | 150.5% | | Effective Income Tax Rate | 18.5% | 18.6% | -0.1% | - The significant increase in income tax expense was primarily due to higher profit before tax and reduced tax refunds received during the reporting period[53](index=53&type=chunk) [Net Profit and Net Margin](index=20&type=section&id=Net%20Profit%20and%20Net%20Margin) Net profit increased by **54.8%** to **RMB 2.76 billion** in H1 2025, with net margin rising from **20.8% to 27.7%**, while net profit attributable to owners of the company grew by **56.0%** to **RMB 2.34 billion**, with net margin increasing from **17.5% to 23.5%**, primarily due to higher gross profit and investment gains | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Net Profit | 2,756.6 | 1,780.3 | 54.8% | | Net Margin | 27.7% | 20.8% | +6.9% | | Net Profit Attributable to Owners of the Company | 2,339.3 | 1,499.1 | 56.0% | | Net Margin Attributable to Owners of the Company | 23.5% | 17.5% | +6.0% | - The increase in net profit and net margin was primarily due to higher gross profit and investment gains derived from the Group's investment and incubation portfolio[54](index=54&type=chunk) [Basic and Diluted Earnings Per Share](index=20&type=section&id=Basic%20and%20Diluted%20Earnings%20Per%20Share) Basic earnings per share increased by **56.8%** to **RMB 0.58** in H1 2025, and diluted earnings per share grew by **57.1%** to **RMB 0.55**, primarily due to the increase in net profit attributable to owners of the company | Metric | H1 2025 (RMB) | H1 2024 (RMB) | Change | | :--- | :--- | :--- | :--- | | Basic EPS | 0.58 | 0.37 | 56.8% | | Diluted EPS | 0.55 | 0.35 | 57.1% | - The increase in basic and diluted earnings per share was primarily due to the increase in net profit attributable to owners of the company[55](index=55&type=chunk) [Analysis of Statement of Financial Position Items](index=20&type=section&id=Analysis%20of%20Statement%20of%20Financial%20Position%20Items) [Non-current Assets](index=20&type=section&id=Non-current%20Assets) As of June 30, 2025, total non-current assets increased to **RMB 35.99 billion**, primarily driven by an increase in property, plant and equipment and growth in financial assets measured at fair value [Property, Plant and Equipment](index=20&type=section&id=Property%2C%20Plant%20and%20Equipment) The balance of property, plant and equipment increased by **6.7%** to **RMB 27.82 billion**, primarily due to ongoing construction in Singapore and an increase in the RMB reported balance of European assets resulting from the appreciation of the Euro against the RMB | Metric | As of June 30, 2025 (RMB million) | As of Dec 31, 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Property, Plant and Equipment | 27,815.9 | 26,070.5 | 6.7% | - The increase was primarily due to ongoing construction in Singapore and an increase in the RMB reported balance of European assets resulting from the appreciation of the Euro against the RMB[56](index=56&type=chunk) [Right-of-use Assets](index=21&type=section&id=Right-of-use%20Assets) Right-of-use assets balance was approximately **RMB 2.36 billion**, remaining at the same level as at the end of 2024 | Metric | As of June 30, 2025 (RMB million) | As of Dec 31, 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Right-of-use Assets | 2,359.2 | 2,364.9 | -0.2% | [Goodwill](index=21&type=section&id=Goodwill) Goodwill was approximately **RMB 1.53 billion**, consistent with the end of 2024, originating from acquisitions of subsidiaries and businesses several years ago | Metric | As of June 30, 2025 (RMB million) | As of Dec 31, 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Goodwill | 1,529.9 | 1,529.9 | 0.0% | [Intangible Assets](index=21&type=section&id=Intangible%20Assets) Intangible assets were approximately **RMB 441.1 million**, consistent with the end of 2024, primarily comprising technology and customer relationships acquired, as well as patents and licenses held | Metric | As of June 30, 2025 (RMB million) | As of Dec 31, 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Intangible Assets | 441.1 | 442.4 | -0.3% | [Investments in Associates Measured at Fair Value](index=21&type=section&id=Investments%20in%20Associates%20Measured%20at%20Fair%20Value%20through%20Profit%20or%20Loss) The investment balance in associate Shanghai Douneng Biotechnology Co., Ltd. decreased by **16.8%** to **RMB 1.05 billion**, due to the re-evaluation of the investment's fair value during the reporting period | Metric | As of June 30, 2025 (RMB million) | As of Dec 31, 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Investments in Associates | 1,053.8 | 1,266.6 | -16.8% | - The decrease in the investment balance was due to the re-evaluation of the investment's fair value during the reporting period[60](index=60&type=chunk) [Financial Assets Measured at Fair Value](index=21&type=section&id=Financial%20Assets%20Measured%20at%20Fair%20Value%20through%20Profit%20or%20Loss) Non-current financial assets increased by **72.3%** to **RMB 1.95 billion**, primarily due to fair value gains recognized on listed equity securities investments and new investments, while current financial assets grew by **80.1%** to **RMB 942.8 million**, mainly attributed to WuXi XDC's increased investment in wealth management products | Metric | As of June 30, 2025 (RMB million) | As of Dec 31, 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Non-current Financial Assets | 1,952.9 | 1,133.3 | 72.3% | | Current Financial Assets | 942.8 | 523.6 | 80.1% | - The increase in non-current financial assets was primarily due to fair value gains recognized on listed equity securities investments and new investments, while the increase in current financial assets was mainly attributed to WuXi XDC's increased investment in wealth management products[61](index=61&type=chunk) [Other Long-term Receivables and Provisions](index=22&type=section&id=Other%20Long-term%20Receivables%20and%20Provisions) As of June 30, 2025, other long-term receivables increased to **RMB 276.3 million**, primarily including **USD 30 million** deposited into an escrow account from the Ireland vaccine manufacturing facility asset transaction, with management expecting the **USD 24 million** cap to be sufficient to cover potential claims and making a provision accordingly - As of March 31, 2025, the asset transaction related to the Ireland vaccine manufacturing facility was completed, with MSD International GmbH depositing **USD 30 million** into an escrow account[62](index=62&type=chunk) - Management expects the **USD 24 million** cap to be sufficient to cover potential claims that may arise post-closing, and a provision has been made under non-current liabilities[62](index=62&type=chunk) [Current Assets](index=22&type=section&id=Current%20Assets) As of June 30, 2025, total current assets increased to **RMB 24.45 billion**, primarily driven by increases in trade and other receivables, inventories, and contract costs [Inventories](index=22&type=section&id=Inventories) Inventories increased by **8.8%** to **RMB 1.66 billion**, primarily attributed to replenishing stock for the ramp-up of European entities and WuXi XDC accumulating reserves to facilitate business expansion | Metric | As of June 30, 2025 (RMB million) | As of Dec 31, 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Inventories | 1,655.0 | 1,521.7 | 8.8% | - The increase was primarily attributed to replenishing stock for the ramp-up of European entities and WuXi XDC accumulating reserves to facilitate its business expansion[63](index=63&type=chunk) [Contract Costs](index=22&type=section&id=Contract%20Costs) Contract costs increased by **4.1%** to **RMB 1.55 billion**, primarily attributed to the global business ramp-up and an increase in ongoing projects | Metric | As of June 30, 2025 (RMB million) | As of Dec 31, 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Contract Costs | 1,554.6 | 1,492.9 | 4.1% | - The increase was primarily attributed to the global business ramp-up and an increase in ongoing projects[64](index=64&type=chunk) [Trade and Other Receivables](index=22&type=section&id=Trade%20and%20Other%20Receivables) Trade and other receivables increased by **23.7%** to **RMB 7.72 billion**, primarily due to an increase in trade receivables as the Group's business expanded and revenue grew | Metric | As of June 30, 2025 (RMB million) | As of Dec 31, 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Trade and Other Receivables | 7,721.2 | 6,240.7 | 23.7% | - The increase was primarily due to an increase in trade receivables as the Group's business expanded and revenue grew[65](index=65&type=chunk) [Contract Assets](index=22&type=section&id=Contract%20Assets) Contract assets decreased by **11.9%** to **RMB 169.1 million**, primarily due to projects reaching milestones during the reporting period and being reclassified as trade receivables | Metric | As of June 30, 2025 (RMB million) | As of Dec 31, 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Contract Assets | 169.1 | 191.9 | -11.9% | - The decrease was primarily due to projects reaching milestones specified in contracts with customers during the reporting period and being reclassified as trade receivables[66](index=66&type=chunk) [Assets Classified as Held for Sale](index=23&type=section&id=Assets%20Classified%20as%20Held%20for%20Sale) As of June 30, 2025, relevant assets (including property, plant and equipment and inventories) amounting to approximately **RMB 722.2 million** have been reclassified as held for sale, with the transaction expected to be completed in H2 2025, following the sale of approximately **RMB 3.38 billion** in assets classified as held for sale at the end of 2024, which was completed in H1 2025 | Metric | As of June 30, 2025 (RMB million) | As of Dec 31, 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Assets Classified as Held for Sale | 722.2 | 3,377.1 | -78.6% | - The assets related to the Ireland vaccine manufacturing facility intended for sale at the end of 2024 were transacted in H1 2025; during the reporting period, the company entered into another contract to sell certain German assets to an independent third party, and these assets have been reclassified as held for sale[67](index=67&type=chunk) [Current Liabilities](index=23&type=section&id=Current%20Liabilities) As of June 30, 2025, total current liabilities slightly decreased to **RMB 8.49 billion**, primarily influenced by a reduction in trade and other payables, though contract liabilities and borrowings increased [Trade and Other Payables](index=23&type=section&id=Trade%20and%20Other%20Payables) Trade and other payables decreased by **22.1%** to **RMB 2.16 billion**, primarily due to reduced advances from MSD International and lower salaries and bonuses payable after year-end bonus payments, partially offset by an increase in trade payables | Metric | As of June 30, 2025 (RMB million) | As of Dec 31, 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Trade and Other Payables | 2,164.5 | 2,778.2 | -22.1% | - The decrease was primarily due to reduced advances from MSD International and lower salaries and bonuses payable after year-end bonus payments, partially offset by an increase in trade payables[68](index=68&type=chunk) [Contract Liabilities](index=23&type=section&id=Contract%20Liabilities) Current contract liabilities increased by **18.6%** to **RMB 2.80 billion**, primarily due to entering into more contracts and management's commitment to strict upfront payment requirements, while non-current contract liabilities grew by **11.6%** to **RMB 159.4 million** due to foreign exchange revaluation of Euro-denominated balances | Metric | As of June 30, 2025 (RMB million) | As of Dec 31, 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Current Contract Liabilities | 2,795.1 | 2,355.8 | 18.6% | | Non-current Contract Liabilities | 159.4 | 142.8 | 11.6% | - The increase in current contract liabilities was primarily due to entering into more contracts and management's commitment to strict upfront payment requirements, while the increase in non-current contract liabilities was due to foreign exchange revaluation of Euro-denominated balances[69](index=69&type=chunk) [Lease Liabilities](index=24&type=section&id=Lease%20Liabilities) Total lease liabilities slightly increased by **3.1%** to **RMB 2.37 billion**, consistent with the trend of increasing leased facilities and offices to support business expansion | Metric | As of June 30, 2025 (RMB million) | As of Dec 31, 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Total Lease Liabilities | 2,374.4 | 2,303.6 | 3.1% | - The increase is consistent with the trend of increasing leased facilities and offices to support the Group's business expansion[70](index=70&type=chunk) [Liquidity and Capital Resources](index=24&type=section&id=Liquidity%20and%20Capital%20Resources) [Bank Balances and Cash](index=24&type=section&id=Bank%20Balances%20and%20Cash) Total bank balances and cash and time deposits increased by **13.8%** to **RMB 11.60 billion**, primarily due to proceeds from the sale of Ireland vaccine manufacturing facility assets and net cash inflow from operating activities, partially offset by payments for property, plant and equipment and share repurchases | Metric | As of June 30, 2025 (RMB million) | As of Dec 31, 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Total Bank Balances and Cash and Time Deposits | 11,596.9 | 10,186.2 | 13.8% | - The increase was primarily due to proceeds from the sale of Ireland vaccine manufacturing facility assets and net cash inflow from operating activities, partially offset by payments for property, plant and equipment and share repurchases[71](index=71&type=chunk) [Treasury Policy](index=24&type=section&id=Treasury%20Policy) WuXi Biologics adheres to a comprehensive financing and treasury policy, managing funding needs through diverse sources such as operating cash flow, proceeds from asset disposals, and internal/external financing, while centralizing treasury functions and negotiating derivative instruments like forward foreign exchange contracts with banks to mitigate foreign exchange risk - The company adheres to a comprehensive financing and treasury policy, managing funding needs through diverse sources such as operating cash flow, proceeds from asset disposals, and internal/external financing[72](index=72&type=chunk) - Treasury functions are centrally managed, and a range of derivative instruments, such as forward foreign exchange contracts, are negotiated with banks to mitigate foreign exchange risk[72](index=72&type=chunk) [Significant Investments, Material Acquisitions and Disposals](index=24&type=section&id=Significant%20Investments%2C%20Material%20Acquisitions%20and%20Disposals) [Significant Investments, Material Acquisitions and Disposals](index=24&type=section&id=Significant%20Investments%2C%20Material%20Acquisitions%20and%20Disposals) As of June 30, 2025, the Company held no significant investments, and there were no material acquisitions or disposals of subsidiaries, associates, or joint ventures during the reporting period - As of June 30, 2025, the Company held no significant investments, and there were no material acquisitions or disposals of subsidiaries, associates, or joint ventures during the reporting period[73](index=73&type=chunk) [Indebtedness](index=25&type=section&id=Indebtedness) [Borrowings](index=25&type=section&id=Borrowings) Total borrowings increased by **3.7%** to **RMB 2.73 billion**, primarily due to WuXi XDC's funding needs to support its rapid business expansion, with borrowings denominated in RMB, USD, and Euro, and the majority maturing within one year | Metric | As of June 30, 2025 (RMB million) | As of Dec 31, 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Total Borrowings | 2,732.7 | 2,636.2 | 3.7% | - The increase in borrowings was primarily due to WuXi XDC's funding needs to support its rapid business expansion[74](index=74&type=chunk) - Borrowings are denominated in RMB (**RMB 1.24 billion**, **1.4%-3.9%**), USD (**RMB 1.05 billion**, **5.3%-5.7%**), and Euro (**RMB 444.0 million**, **2.7%-4.2%**), with approximately **RMB 2.55 billion** maturing within one year[74](index=74&type=chunk) [Contingent Liabilities and Guarantees](index=25&type=section&id=Contingent%20Liabilities%20and%20Guarantees) As of June 30, 2025, WuXi Biologics had no significant contingent liabilities or guarantees - As of June 30, 2025, the Group had no significant contingent liabilities or guarantees[75](index=75&type=chunk) [Currency Risk](index=25&type=section&id=Currency%20Risk) WuXi Biologics faces foreign exchange risk primarily because revenue is denominated in USD, while purchases and expenses are settled in RMB, USD, and Euro, and the company holds USD and Euro-denominated borrowings and monetary assets/liabilities, mitigating this risk by closely monitoring net foreign exchange positions and entering into hedging instruments like forward contracts - The company faces foreign exchange risk primarily because revenue is denominated in USD, while purchases and expenses are settled in RMB, USD, and Euro, and it holds USD and Euro-denominated borrowings and monetary assets/liabilities[76](index=76&type=chunk) - Foreign exchange risk is mitigated by closely monitoring net foreign exchange positions and entering into a series of highly effective hedging instruments such as forward contracts[76](index=76&type=chunk) [Pledged Assets](index=26&type=section&id=Pledged%20Assets) As of June 30, 2025, pledged bank deposits were approximately **RMB 13.8 million**, remaining stable compared to the end of 2024, and buildings with a carrying value of approximately **RMB 16.8 million** were pledged as collateral for RMB-denominated borrowings of approximately **RMB 43.7 million** | Metric | As of June 30, 2025 (RMB million) | As of Dec 31, 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Pledged Bank Deposits (RMB million) | 13.8 | 13.9 | -0.7% | | Pledged Buildings (Carrying Value, RMB million) | 16.8 | 16.9 | -0.6% | | Corresponding RMB Borrowings (RMB million) | 43.7 | 48.3 | -9.5% | [Capital Gearing Ratio](index=26&type=section&id=Capital%20Gearing%20Ratio) The capital gearing ratio decreased from **5.8%** at the end of 2024 to **5.6%** as of June 30, 2025, primarily due to the growth in total equity resulting from net profit recorded during the reporting period | Metric | As of June 30, 2025 | As of Dec 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Capital Gearing Ratio | 5.6% | 5.8% | -0.2% | - The decrease in the capital gearing ratio was primarily due to the growth in total equity resulting from net profit recorded during the reporting period[78](index=78&type=chunk) [Non-IFRS Measures](index=26&type=section&id=Non-IFRS%20Measures) [Adjusted Net Profit and EPS](index=27&type=section&id=Adjusted%20Net%20Profit%20and%20EPS) Adjusted net profit increased by **11.6%** to **RMB 2.84 billion** in H1 2025, with an adjusted net margin of **28.5%**, while adjusted net profit attributable to owners of the company grew by **6.2%** to **RMB 2.39 billion**, and adjusted basic earnings per share was **RMB 0.59** | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Adjusted Net Profit | 2,840.0 | 2,544.8 | 11.6% | | Adjusted Net Margin | 28.5% | 29.7% | -1.2% | | Adjusted Net Profit Attributable to Owners of the Company | 2,388.8 | 2,250.3 | 6.2% | | Adjusted Net Margin Attributable to Owners of the Company | 24.0% | 26.2% | -2.2% | | Adjusted Basic EPS (RMB) | 0.59 | 0.55 | 7.3% | | Adjusted Diluted EPS (RMB) | 0.56 | 0.52 | 7.7% | - Adjusted net profit excludes share-based compensation expenses, foreign exchange gains/losses, and gains/losses from equity investments/asset disposals[81](index=81&type=chunk) [Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA)](index=28&type=section&id=Earnings%20Before%20Interest%2C%20Tax%2C%20Depreciation%20and%20Amortization%20%28EBITDA%29) Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA) increased by **50.5%** to **RMB 4.22 billion** in H1 2025, with an EBITDA margin of **42.4%**, while adjusted EBITDA grew by **20.6%** to **RMB 4.31 billion**, with an adjusted EBITDA margin of **43.3%** | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | EBITDA (RMB million) | 4,221.8 | 2,805.9 | 50.5% | | EBITDA Margin | 42.4% | 32.7% | +9.7% | | Adjusted EBITDA (RMB million) | 4,305.2 | 3,570.4 | 20.6% | | Adjusted EBITDA Margin | 43.3% | 41.6% | +1.7% | [Other Corporate Information](index=28&type=section&id=Other%20Corporate%20Information) [Employees and Remuneration Policy](index=28&type=section&id=Employees%20and%20Remuneration%20Policy) As of the end of the reporting period, WuXi Biologics had a total workforce of **12,552 employees**, including approximately **4,362 R&D personnel**, with a key talent retention rate of approximately **98.8%**, and employee costs (excluding retirement benefits and share-based compensation) increased by **12.7%** to **RMB 2.59 billion**, supported by effective training systems and multiple equity incentive plans | Metric | As of June 30, 2025 | As of June 30, 2024 | Change | | :--- | :--- | :--- | :--- | | Total Employees | 12,552 people | - | - | | R&D Personnel | 4,362 people | - | - | | Key Talent Retention Rate | 98.8% | - | - | | Employee Costs (Excl. Retirement Benefits & Share-based Compensation) (RMB million) | 2,586.6 | 2,295.2 | 12.7% | - The company has effective training systems (onboarding and continuous in-service training) and multiple equity incentive plans (Pre-IPO Share Option Scheme, Restricted Share Award Scheme, Global Partner Share Award Scheme, etc.)[83](index=83&type=chunk)[84](index=84&type=chunk) [Interim Dividend](index=29&type=section&id=Interim%20Dividend) The Board has resolved not to declare any interim dividend for the six months ended June 30, 2025 - The Board has resolved not to declare any interim dividend for the six months ended June 30, 2025[85](index=85&type=chunk) [Corporate Governance](index=29&type=section&id=Corporate%20Governance) WuXi Biologics is committed to maintaining high standards of corporate governance, having adopted the Corporate Governance Code set out in Appendix C1 of the Listing Rules and complied with all applicable code provisions during the reporting period, and has adopted a code of conduct for directors' securities transactions no less exacting than the Model Code, with all directors confirming compliance with both the code and written guidelines during the reporting period [Compliance with Corporate Governance Code](index=29&type=section&id=Compliance%20with%20Corporate%20Governance%20Code) WuXi Biologics is committed to maintaining high standards of corporate governance, having adopted the Corporate Governance Code set out in Appendix C1 of the Listing Rules and complied with all applicable code provisions during the reporting period - The Corporate Governance Code set out in Appendix C1 of the Listing Rules has been adopted, and all applicable code provisions were complied with throughout the reporting period[86](index=86&type=chunk) [Compliance with Model Code for Securities Transactions](index=29&type=section&id=Compliance%20with%20Model%20Code%20for%20Securities%20Transactions) WuXi Biologics has adopted a code of conduct for directors' securities transactions no less exacting than the Model Code, with all directors confirming compliance with both the code and written guidelines during the reporting period, and no non-compliance by employees with inside information was identified - A code of conduct for directors' securities transactions no less exacting than the Model Code has been adopted, and all directors confirmed compliance with both the code and written guidelines during the reporting period[87](index=87&type=chunk) [Use of Proceeds from Fourth Placing](index=30&type=section&id=Use%20of%20Proceeds%20from%20Fourth%20Placing) The net proceeds from the fourth placing, approximately **RMB 10.90 billion**, were planned for acquiring additional DS/DP manufacturing capacity (**40%**), establishing large-scale manufacturing capacity (**40%**), investing in mRNA-related technologies (**10%**), and general working capital purposes (**10%**), with **RMB 9.16 billion** utilized and **RMB 1.74 billion** remaining as of June 30, 2025 | Use of Proceeds | Planned Use (RMB million) | Percentage | Actual Use as of June 30, 2025 (RMB million) | Net Unutilized Proceeds (RMB million) | Expected Timeline | | :--- | :--- | :--- | :--- | :--- | :--- | | Acquisition of additional Drug Substance/Drug Product (DS/DP) manufacturing capacity | 4,359.6 | 40% | 3,660.1 | 699.5 | By end of 2026 | | Establishment of additional large-scale manufacturing capacity for various technology platforms | 4,359.6 | 40% | 4,359.6 | — | Not Applicable | | Investment in mRNA-related technologies | 1,089.9 | 10% | 54.1 | 1,035.8 | By end of 2027 | | General working capital purposes of the Group | 1,089.9 | 10% | 1,089.9 | — | Not Applicable | | **Total** | **10,899.0** | **100%** | **9,163.7** | **1,735.3** | | - The net proceeds from the fourth placing, approximately **RMB 10.90 billion**, were intended to raise additional capital to fund future development[88](index=88&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=31&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company%27s%20Listed%20Securities) During the reporting period, WuXi Biologics repurchased a total of **60,539,500 shares** on the Stock Exchange for a total consideration of approximately **HKD 1.11 billion**, and the repurchased shares have been cancelled, with the repurchase aiming to demonstrate the company's confidence in its business outlook and belief that the current share price does not reflect its intrinsic value | Month of Repurchase | Number of Shares Repurchased | Total Purchase Price (HKD million) | | :--- | :--- | :--- | | January 2025 | 9,509,500 | 165.79 | | April 2025 | 51,030,000 | 944.83 | | **Total** | **60,539,500** | **1,110.62** | - The share repurchases were intended to demonstrate the company's confidence in its business outlook and prospects, believing that the current trading price of the shares does not reflect their intrinsic value or the company's actual prospects[91](index=91&type=chunk) [Review of Interim Results](index=31&type=section&id=Review%20of%20Interim%20Results) Independent auditor Deloitte Touche Tohmatsu has reviewed the interim financial information, and the Audit Committee, in conjunction with management and the independent auditor, has reviewed accounting principles and policies and discussed internal controls and financial reporting matters, concluding that the interim results comply with applicable accounting standards, laws, and regulations - Independent auditor Deloitte Touche Tohmatsu has reviewed the interim financial information in accordance with Hong Kong Standard on Review Engagements 2410 issued by the Hong Kong Institute of Certified Public Accountants[93](index=93&type=chunk) - The Audit Committee, in conjunction with management and the independent auditor, has reviewed accounting principles and policies and discussed internal controls and financial reporting matters, concluding that the interim results comply with applicable accounting standards, laws, and regulations[93](index=93&type=chunk) [Events After Reporting Period](index=32&type=section&id=Events%20After%20Reporting%20Period) No significant events affecting WuXi Biologics occurred after June 30, 2025 - No significant events affecting the Group occurred after June 30, 2025[94](index=94&type=chunk) [Publication of 2025 Condensed Consolidated Interim Results and Interim Report](index=32&type=section&id=Publication%20of%202025%20Condensed%20Consolidated%20Interim%20Results%20and%20Interim%20Report) This announcement has been published on the HKEX website and the company's website, and the interim report for the six months ended June 30, 2025, containing all information required by the Listing Rules, will be published on the HKEX and company websites in due course - This announcement has been published on the HKEX website (www.hkexnews.hk) and the Company's website (www.wuxibiologics.com)[95](index=95&type=chunk) [Condensed Consolidated Financial Statements](index=32&type=section&id=Condensed%20Consolidated%20Financial%20Statements) [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=32&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) WuXi Biologics' H1 2025 Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income shows revenue of **RMB 9.95 billion**, profit for the period of **RMB 2.76 billion**, and total comprehensive income of **RMB 4.11 billion** | Metric | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue | 9,953,216 | 8,574,214 | | Cost of sales | (5,700,364) | (5,224,263) | | Gross profit | 4,252,852 | 3,349,951 | | Other income | 326,414 | 338,659 | | Other gains and losses | 360,977 | (81,882) | | Impairment losses (net of reversals) | (133,843) | (190,170) | | Selling and marketing expenses | (270,110) | (223,057) | | Administrative expenses | (781,134) | (772,988) | | Research and development expenses | (343,512) | (344,062) | | Finance costs | (83,543) | (68,074) | | Profit before tax | 3,328,101 | 2,008,377 | | Income tax expense | (571,490) | (228,067) | | **Profit for the period** | **2,756,611** | **1,780,310** | | Other comprehensive income (expense) for the period | 1,357,842 | (534,156) | | **Total comprehensive income for the period** | **4,114,453** | **1,246,154** | | Profit attributable to owners of the Company | 2,339,266 | 1,499,080 | | Profit attributable to non-controlling interests | 417,345 | 281,230 | | Total comprehensive income attributable to owners of the Company | 3,699,891 | 973,549 | | Total comprehensive income attributable to non-controlling interests | 414,562 | 272,605 | | Basic EPS (RMB) | 0.58 | 0.37 | | Diluted EPS (RMB) | 0.55 | 0.35 | [Condensed Consolidated Statement of Financial Position](index=35&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, WuXi Biologics' Condensed Consolidated Statement of Financial Position shows total assets of **RMB 60.44 billion**, total liabilities of **RMB 11.37 billion**, and total equity of **RMB 49.07 billion** | Metric | As of June 30, 2025 (RMB thousand) | As of Dec 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | **Non-current Assets** | | | | Property, plant and equipment | 27,815,903 | 26,070,458 | | Right-of-use assets | 2,359,237 | 2,364,916 | | Goodwill | 1,529,914 | 1,529,914 | | Intangible assets | 441,104 | 442,369 | | Investments in associates (FVTPL) | 1,053,845 | 1,266,560 | | Financial assets (FVTPL) | 1,952,924 | 1,133,265 | | Finance lease receivables | 78,470 | 85,665 | | Deferred tax assets | 483,095 | 444,318 | | Other long-term prepayments and receivables | 276,262 | 66,779 | | **Total non-current assets** | **35,990,754** | **33,404,244** | | **Current Assets** | | | | Inventories | 1,655,042 | 1,521,669 | | Finance lease receivables | 11,686 | 11,027 | | Trade and other receivables | 7,721,150 | 6,240,747 | | Contract assets | 169,123 | 191,927 | | Contract costs | 1,554,605 | 1,492,931 | | Tax recoverable | 53,233 | 14,105 | | Derivative financial assets | 6,177 | — | | Financial assets (FVTPL) | 942,764 | 523,593 | | Pledged bank deposits | 13,813 | 13,854 | | Time deposits | 3,157,800 | 1,907,016 | | Bank balances and cash | 8,439,058 | 8,279,182 | | **Total current assets** | **23,724,451** | **20,196,051** | | Assets classified as held for sale | 722,182 | 3,377,140 | | **Total Assets** | **60,437,387** | **56,977,435** | | **Current Liabilities** | | | | Trade and other payables | 2,164,548 | 2,778,195 | | Borrowings | 2,547,550 | 2,435,302 | | Contract liabilities | 2,795,070 | 2,355,772 | | Income tax payable | 518,464 | 647,658 | | Lease liabilities | 436,058 | 183,704 | | Derivative financial liabilities | 25,655 | 220,620 | | **Total current liabilities** | **8,487,345** | **8,621,251** | | **Non-current Liabilities** | | | | Deferred tax liabilities | 73,182 | 97,306 | | Borrowings | 185,140 | 200,898 | | Contract liabilities | 159,402 | 142,770 | | Lease liabilities | 1,938,314 | 2,119,945 | | Provisions | 171,806 | — | | Deferred income | 357,127 | 317,696 | | **Total non-current liabilities** | **2,884,971** | **2,878,615** | | **Total Equity** | **49,065,071** | **45,477,569** | [Notes to the Condensed Consolidated Financial Statements](index=37&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) [1. General Information](index=37&type=section&id=1.%20General%20Information) WuXi Biologics (Cayman) Inc. was incorporated in the Cayman Islands on February 27, 2014, and listed on the Main Board of the Hong Kong Stock Exchange on June 13, 2017, operating as a biologics Contract Research, Development and Manufacturing Organization (CRDMO) providing end-to-end solutions for biologics discovery, development, and manufacturing, with its condensed consolidated financial statements presented in RMB - The Company was incorporated in the Cayman Islands on February 27, 2014, and its shares have been listed on the Main Board of The Stock Exchange of Hong Kong Limited ("HKEX") since June 13, 2017[102](index=102&type=chunk) - The Group operates as a biologics Contract Research, Development and Manufacturing Organization (CRDMO), providing end-to-end solutions for biologics discovery, development, and manufacturing[102](index=102&type=chunk) - The condensed consolidated financial statements are presented in Renminbi ("RMB"), which is also the Company's functional currency[103](index=103&type=chunk) [2. Basis of Preparation of Condensed Consolidated Financial Statements](index=37&type=section&id=2.%20Basis%20of%20Preparation%20of%20Condensed%20Consolidated%20Financial%20Statements) The condensed consolidated financial statements have been prepared in accordance with International Accounting Standard 34 and the applicable disclosure requirements of the Listing Rules of the Stock Exchange - The condensed consolidated financial statements have been prepared in accordance with International Accounting Standard 34 issued by the International Accounting Standards Board and the applicable disclosure requirements of the Listing Rules of the Stock Exchange[104](index=104&type=chunk) [3. Principal Accounting Policies](index=37&type=section&id=3.%20Principal%20Accounting%20Policies) The condensed consolidated financial statements are prepared on a historical cost basis, except for certain financial instruments measured at fair value, with the first-time application of amended IFRS accounting standards during this interim period having no significant impact on financial position and performance [Application of Amended IFRS Accounting Standards](index=38&type=section&id=Application%20of%20Amended%20IFRS%20Accounting%20Standards) The amendment to International Accounting Standard 21 "Lack of Exchangeability" issued by the International Accounting Standards Board was first applied during this interim period, but it had no significant impact on the Group's financial position, performance, and/or disclosures for the current and prior periods - The amendment to International Accounting Standard 21 "Lack of Exchangeability" issued by the International Accounting Standards Board was first applied during this interim period[106](index=106&type=chunk) - The application of amended IFRS accounting standards had no significant impact on the Group's financial position, performance, and/or disclosures for the current and prior periods[106](index=106&type=chunk) [4. Revenue from Contracts with Customers](index=38&type=section&id=4.%20Revenue%20from%20Contracts%20with%20Customers) WuXi Biologics' revenue primarily derives from CRDMO services and the transfer of other goods, with H1 2025 CRDMO service revenue at **RMB 9.77 billion**, the majority of which (**RMB 9.33 billion**) is recognized at a point in time | Type of Goods or Services | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- | :--- | :--- | | CRDMO services | 9,766,347 | 8,395,447 | | Others | 186,869 | 178,767 | | **Total** | **9,953,216** | **8,574,214** | | Timing of Revenue Recognition | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- | :--- | :--- | | At a point in time (CRDMO services) | 9,328,459 | 7,677,286 | | At a point in time (Others) | 186,869 | 178,767 | | Over time (CRDMO services) | 437,888 | 718,161 | | **Total** | **9,953,216** | **8,574,214** | [5. Operating Segments](index=39&type=section&id=5.%20Operating%20Segments) WuXi Biologics' operating segments are primarily Biologics and XDC, with H1 2025 external sales revenue for the Biologics segment at **RMB 7.28 billion** and for the XDC segment at **RMB 2.67 billion**, and key operating decision-makers allocate resources and assess performance based on the operating results of each segment | Segment | H1 2025 External Sales (RMB thousand) | H1 2024 External Sales (RMB thousand) | | :--- | :--- | :--- | | Biologics | 7,281,020 | 6,961,624 | | XDC | 2,672,196 | 1,612,590 | - Key operating decision-makers allocate resources and assess performance based on the operating results of each segment, but segment assets and liabilities are not regularly reviewed[111](index=111&type=chunk) | Region | H1 2025 Revenue (RMB thousand) | H1 2024 Revenue (RMB thousand) | | :--- | :--- | :--- | | North America | 6,018,150 | 5,009,669 | | Europe | 1,968,580 | 1,862,991 | | China | 1,297,016 | 1,417,906 | | Rest of World | 669,470 | 283,648 | - As of June 30, 2025, the Group's non-current assets in Ireland, Germany, the United States, and Singapore amounted to **RMB 8.41 billion**, **RMB 3.37 billion**, **RMB 2.38 billion**, and **RMB 2.89 billion**, respectively[115](index=115&type=chunk) [6. Other Income](index=42&type=section&id=6.%20Other%20Income) Other income in H1 2025 was **RMB 326.4 million**, primarily comprising interest income from bank and other financial assets measured at amortized cost (**RMB 175.4 million**), research and other grants (**RMB 122.3 million**), and dividend income (**RMB 28.7 million**) | Source of Income | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- | :--- | :--- | | Interest income from bank and other financial assets measured at amortized cost | 175,357 | 191,996 | | Research and other grants (asset-related) | 19,558 | 12,021 | | Research and other grants (income-related) | 102,789 | 134,642 | | Dividends | 28,710 | — | | **Total** | **326,414** | **338,659** | - Research and other grants are primarily related to recognizing the Group's contributions to local high-tech industries and the economy, are unconditional, and not related to any assets[117](index=117&type=chunk) [7. Finance Costs](index=42&type=section&id=7.%20Finance%20Costs) Finance costs in H1 2025 were **RMB 83.5 million**, primarily comprising interest expenses on bank borrowings (**RMB 51.1 million**) and lease liabilities (**RMB 40.9 million**), net of **RMB 8.5 million** capitalized | Composition of Finance Costs | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- | :--- | :--- | | Interest expense on financing component of customer advances received | — | 5,293 | | Interest expense on bank borrowings | 51,108 | 58,799 | | Interest expense on lease liabilities | 40,907 | 41,074 | | Less: Amount capitalized in cost of qualifying assets | (8,472) | (37,092) | | **Total** | **83,543** | **68,074** | [8. Profit Before Tax](index=43&type=section&id=8.%20Profit%20Before%20Tax) Profit before tax in H1 2025 was **RMB 3.33 billion**, primarily after deducting items such as depreciation, amortization, employee costs, impairment losses, and write-downs of inventories/contract costs | Deducted Items | H1 2025 (RMB thousand) | H1 2024 (RMB thousand) | | :--- |

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，概不對因本公告全部或任何 部分內容而產生或因依賴該等內容而引致之任何損失承擔任何責任。 KWG GROUP HOLDINGS LIMITED 合景泰富集團控股有限公司 （於開曼群島註冊成立的有限公司） 會不得根據股份獎勵計劃進一步授出獎勵股份。股份獎勵計劃並無規定每名參 與者的最高配額，惟每名參與者的配額須符合上市規則。 （股份代號：1813） 有關2024年報的補充公告 茲提述合景泰富集團控股有限公司（「本公司」）於2025年4月23日刊發其截至2024年 12月31日止年度之的年度報告（「2024年報」）。除文義另有所指外，本公告所用詞彙 與2024年報所界定者及所使用者具有相同涵義。 除於2024年報所披露之資料外，本公司董事會（「董事會」）謹此根據上市規則第 17.07、17.09及17.12條之規定，提供以下與股份獎勵計劃及購股權計劃有關的補充 資料。 股份獎勵計劃 (1) 可供授出的獎勵股份數目 於2024年1月1日及2024年12月31日，根據股份獎勵計劃可供授出的獎勵股份數 ...

[Company Information](index=4&type=section&id=Company%20Information) [Company Overview and Business Scope](index=4&type=section&id=Company%20Overview%20and%20Business%20Scope) China Hanking, established in 2010 and listed in 2011, operates iron ore and high-purity iron in China and gold mining in Australia - The company was incorporated in the Cayman Islands on August 2, 2010, and listed on the Hong Kong Stock Exchange on September 30, 2011, with stock code **03788**[5](index=5&type=chunk) - The company's core values are 'people-oriented, integrity first,' with a mission of 'safety, harmony, green,' committed to corporate social responsibility[6](index=6&type=chunk) - Domestic operations include iron ore and high-purity iron, with iron concentrate averaging over **68%** grade, and high-purity iron products suitable for wind power and marine engineering castings[7](index=7&type=chunk) - Australian gold mining business, initiated in 2010, has completed the acquisition, exploration, production restart, and capitalization of the SXO gold mine project, developing a professional gold mine development and operation team[8](index=8&type=chunk) [Shareholding Structure and Contact Information](index=5&type=section&id=Shareholding%20Structure%20and%20Contact%20Information) This report details the Group's shareholding structure, company contact information, and lists board members with their committee affiliations - The company's shareholding structure chart illustrates the equity stakes of China Hanking Holdings Limited and its various domestic and overseas subsidiaries[10](index=10&type=chunk) - The company's stock code is **03788**, with its registered office in the Cayman Islands, China headquarters in Shenyang, Liaoning, and principal place of business in Hong Kong located in Causeway Bay[12](index=12&type=chunk) - The Board of Directors comprises executive, non-executive, and independent non-executive directors, with established Audit, Remuneration, Nomination, and Health, Safety, Environment, and Community Committees[14](index=14&type=chunk) [Financial Highlights](index=8&type=section&id=Financial%20Highlights) [Key Financial Indicators for H1 2025](index=8&type=section&id=Key%20Financial%20Indicators%20for%20H1%202025) H1 2025 revenue grew by **10.77%** to **RMB 1,405,188 thousand**, but profit attributable to owners decreased by **2.93%**, with diluted EPS and profitability ratios also declining Key Financial Indicators for H1 2025 | Indicator | H1 2025 (RMB thousands) | H1 2024 (RMB thousands) | Change Rate | | :--- | :--- | :--- | :--- | | Revenue | 1,405,188 | 1,268,564 | 10.77% | | Profit for the period attributable to owners of the company | 104,318 | 107,467 | (2.93%) | | Earnings per share (RMB cents) | 5.4 | 5.6 | (3.57%) | | Interim dividend (HKD per share) | － | 0.02 | N/A | | Net profit margin | 7.44% | 8.41% | Decreased by 0.97 percentage points | | Return on equity | 7.01% | 7.19% | Decreased by 0.18 percentage points | [Management Discussion and Analysis](index=9&type=section&id=Management%20Discussion%20and%20Analysis) [I. Operating Review](index=9&type=section&id=I.%20Operating%20Review) In H1 2025, operations remained stable, iron concentrate and high-purity iron sales exceeded expectations, high-purity iron turned profitable, and Shangma Iron Mine added **79.76 million tons** of resources [1. Proposed Spin-off and Separate Listing of Hanking Gold on the Main Board of the Stock Exchange](index=9&type=section&id=1.%20Proposed%20Spin-off%20and%20Separate%20Listing%20of%20Hanking%20Gold%20on%20the%20Main%20Board%20of%20the%20Stock%20Exchange) The company proposes to spin off Hanking Gold for a separate HKEX listing, aiming to create an independent capital platform and enhance shareholder value - The company proposes to spin off Hanking Gold for a separate listing on the Main Board of the Stock Exchange, aiming to create an independent capital platform for its gold mining business, promote business development, and enhance shareholder value[18](index=18&type=chunk) - Hanking Gold holds the Mt Bundy Gold Mine Project and Cygnet Gold Mine Project, with the goal of becoming an internationally influential medium-sized gold producer[18](index=18&type=chunk) [2. Stable Production and Operations, Slight Decrease in Period Profit](index=9&type=section&id=2.%20Stable%20Production%20and%20Operations%2C%20Slight%20Decrease%20in%20Period%20Profit) H1 2025 saw stable production and sales of iron concentrate and high-purity iron, though period profit slightly decreased due to lower average selling prices - In H1 2025, the company maintained stable production and operations, with iron concentrate and high-purity iron production and sales volumes exceeding both the prior year period and budget[19](index=19&type=chunk) H1 2025 Revenue and Profit | Indicator | Amount (RMB thousands) | YoY Growth/Decrease | | :--- | :--- | :--- | | Revenue | 1,405,188 | 10.77% | | Profit for the Period | 104,537 | (1.99%) | - The decrease in profit for the period was primarily due to overall market conditions, with the average selling price per ton of product lower than the prior year period[19](index=19&type=chunk) [3. High-Purity Iron Business Turns Profitable](index=9&type=section&id=3.%20High-Purity%20Iron%20Business%20Turns%20Profitable) Despite market competition, the high-purity iron business achieved profitability in H1 2025 through enhanced full-process management - Facing intense market competition and price declines, the high-purity iron business achieved profitability in H1 2025 by enhancing its full-process management capabilities[20](index=20&type=chunk) High-Purity Iron Business Pre-tax Profit | Indicator | H1 2025 (RMB thousands) | H1 2024 (RMB thousands) | | :--- | :--- | :--- | | Pre-tax Profit | 14,956 | (35,503) (Loss) | [4. Shangma Iron Mine's Newly Added 79.76 Million Tons of Resources Included in Mining Permit](index=9&type=section&id=4.%20Shangma%20Iron%20Mine's%20Newly%20Added%2079.76%20Million%20Tons%20of%20Resources%20Included%20in%20Mining%20Permit) Shangma Iron Mine's updated permit added **79.76 million tons** of iron ore, boosting total resources to **110 million tons** for sustainable development - Shangma Iron Mine obtained an updated mining permit, expanding its mining area and adding approximately **79.76 million tons** of iron ore resources[21](index=21&type=chunk) - Shangma Iron Mine now possesses a total iron ore resource of approximately **110 million tons**, reaching the 'large-scale iron mine' classification, laying a foundation for the Group's sustainable iron ore business development[21](index=21&type=chunk) [II. Iron Ore Business](index=10&type=section&id=II.%20Iron%20Ore%20Business) H1 2025 iron ore prices fluctuated, with a weak H2 outlook; production and sales grew, but gross profit and margin declined due to lower prices, while resource reserves increased [1. Industry Overview](index=10&type=section&id=1.%20Industry%20Overview) H1 2025 iron ore prices saw initial gains then falls, with a projected volatile and weak H2 trend due to stable international supply and domestic steel controls - In H1 2025, iron ore prices initially rose then fell, with the **62%** port spot price index at **USD 92.39/ton** as of June 30, a **9.07%** decrease from the beginning of the year[23](index=23&type=chunk) - For H2 2025, international mine shipments are expected to maintain steady growth, while domestic crude steel controls and seasonal pig iron declines suggest weaker supply-demand dynamics, potentially leading to continued volatile and weak iron ore prices[23](index=23&type=chunk) [2. Operating Performance](index=10&type=section&id=2.%20Operating%20Performance) H1 2025 iron concentrate production and sales increased, but revenue, gross profit, and gross margin declined due to a significant drop in average selling price - In H1 2025, iron concentrate production reached **518 thousand tons**, a **1.57%** year-on-year increase, with sales volume at **521 thousand tons**, up **2.36%** year-on-year[24](index=24&type=chunk) Iron Ore Business Operating Performance Details | Indicator | H1 2025 | H1 2024 | Change Rate | | :--- | :--- | :--- | :--- | | Production (thousand tons) | 518 | 510 | 1.57% | | Sales (thousand tons) | 521 | 509 | 2.36% | | Average Selling Price (RMB/ton) | 856 | 1,013 | (15.50%) | | Average Cost of Sales (RMB/ton) | 339 | 375 | (9.60%) | | Revenue (RMB thousands) | 447,978 | 515,444 | (13.09%) | | Gross Profit (RMB thousands) | 271,398 | 324,607 | (16.39%) | | Gross Margin | 60.58% | 62.98% | Decreased by 2.40 percentage points | - Cash operating cost per ton of iron concentrate was **RMB 348**, a **2.65%** year-on-year increase, primarily due to professional fees for the Maogong Iron Mine expansion project and increased engineering excavation volume[25](index=25&type=chunk)[26](index=26&type=chunk) [3. Resources and Reserves](index=12&type=section&id=3.%20Resources%20and%20Reserves) New iron ore resources were found at Maogong, and Shangma's permit added **79.76 million tons**, boosting total resources to **110 million tons** - New iron ore resources were discovered within the existing pit of Maogong Iron Mine, with an estimated additional reserve of approximately **3.39 million tons**, acquired at low cost, which will extend the mine's life[33](index=33&type=chunk) - Shangma Iron Mine's mining permit was updated, expanding its area and adding approximately **79.76 million tons** of iron ore resources, bringing the total to **110 million tons** and achieving 'large-scale iron mine' status[33](index=33&type=chunk) - As of the end of June 2025, the Group's iron ore resources and reserves data showed no significant changes compared to the end of 2024[33](index=33&type=chunk) [III. High-Purity Iron Business](index=12&type=section&id=III.%20High-Purity%20Iron%20Business) H1 2025 China's wind power capacity grew significantly, benefiting component demand, while the company's high-purity iron business turned profitable with double-digit growth and improved margins due to cost control [1. Industry Overview](index=12&type=section&id=1.%20Industry%20Overview) H1 2025 China's wind power capacity grew by **22.7%** to **570 GW**, with new installations up **98.9%** to **51.39 GW**, signaling strong demand and price outlook - In H1 2025, national cumulative wind power installed capacity increased by **22.7%** year-on-year to **570 million kilowatts**, with new installed capacity growing by **98.9%** year-on-year to **51.39 million kilowatts**[34](index=34&type=chunk) - Total new wind power installations are projected to reach approximately **100 million kilowatts** for the full year 2025, with cumulative installed capacity expected to reach **640 million kilowatts** by year-end, potentially leading to simultaneous increases in demand and prices for wind power components[34](index=34&type=chunk) [2. Operating Performance](index=13&type=section&id=2.%20Operating%20Performance) The high-purity iron business achieved profitability in H1 2025, with double-digit growth in production and sales volumes, and significantly improved gross profit and margin due to cost control - The high-purity iron business achieved profitability in H1 2025, recording a pre-tax profit of **RMB 14,956 thousand** (compared to a pre-tax loss of **RMB 35,503 thousand** in the prior year period)[35](index=35&type=chunk) High-Purity Iron Business Operating Performance Details | Indicator | H1 2025 | H1 2024 | Change Rate | | :--- | :--- | :--- | :--- | | Production (thousand tons) | 471 | 408 | 15.44% | | Sales (thousand tons) | 473 | 389 | 21.59% | | Average Selling Price (RMB/ton) | 2,685 | 3,131 | (14.24%) | | Average Cost of Sales (RMB/ton) | 2,494 | 3,051 | (18.26%) | | Revenue (RMB thousands) | 1,272,118 | 1,216,935 | 4.53% | | Gross Profit (RMB thousands) | 92,792 | 30,865 | 200.64% | | Gross Margin | 7.29% | 2.54% | Increased by 4.75 percentage points | - Sales of wind power ductile iron accounted for approximately **93%** of total sales, with the company achieving an **18.26%** year-on-year decrease in average cost of sales by developing new suppliers and adjusting raw material ratios[35](index=35&type=chunk) [IV. Australian Gold Mining Business](index=14&type=section&id=IV.%20Australian%20Gold%20Mining%20Business) H1 2025 international gold prices surged; the company advanced Hanking Gold's spin-off, completed Mt Bundy's feasibility study, saw Cygnet's resources grow, and increased capital expenditure [1. Industry Overview](index=14&type=section&id=1.%20Industry%20Overview) H1 2025 international gold prices rose **24.31%** to **USD 3,287.45/ounce** due to global conflicts, with central banks expected to increase holdings, supporting long-term prices - In H1 2025, global regional conflicts and fluctuating trade policies drove international gold prices significantly higher, with the London spot gold fixing price increasing by **24.31%** from the beginning of the year to **USD 3,287.45/ounce**[37](index=37&type=chunk) - A World Gold Council survey indicates that approximately **95%** of surveyed central banks expect to continue increasing their gold holdings within the next 12 months, providing long-term support for gold prices[37](index=37&type=chunk) [2. Operating Performance](index=14&type=section&id=2.%20Operating%20Performance) The company pursues Hanking Gold's spin-off, Mt Bundy's feasibility study is complete, Cygnet is on track for 2027 production, and capital expenditure significantly increased - The company proposes to spin off Hanking Gold for a separate listing on the Main Board of the Stock Exchange to create an independent capital platform for its gold mining business and enhance shareholder value[38](index=38&type=chunk) - The Mt Bundy Gold Mine project has resources of approximately **3.01 million ounces** of gold and reserves of approximately **1.64 million ounces** of gold, with the final feasibility study completed, projecting an average annual production of **170 thousand ounces** of gold for the first 5 years[39](index=39&type=chunk) - The Cygnet Gold Mine project is expected to complete its feasibility study and submit for approval in H2 this year, with construction planned to commence in Q2 2026 and production by the end of 2027[40](index=40&type=chunk) Gold Mining Business Capital Expenditure | Indicator | H1 2025 (RMB thousands) | H1 2024 (RMB thousands) | | :--- | :--- | :--- | | Capital Expenditure | 66,021 | 16,318 | [3. Resources and Reserves](index=15&type=section&id=3.%20Resources%20and%20Reserves) Cygnet Gold Mine's resources increased by **20%** to **2.06 million ounces**, bringing total gold resources to **5.07 million ounces**, with no significant changes since 2024 - Cygnet Gold Mine project's resources increased by **20%** to **2.06 million ounces**, bringing the Group's total gold resources to **5.07 million ounces**[41](index=41&type=chunk) - As of H1 2025, the Group's gold resources and reserves data showed no significant changes compared to the end of 2024[41](index=41&type=chunk) [Future Major Investment or Capital Asset Plans](index=16&type=section&id=Future%20Major%20Investment%20or%20Capital%20Asset%20Plans) As of June 30, 2025, the Group has no concrete plans for major investments beyond ordinary business, but will seek opportunities to broaden revenue and enhance future performance - As of June 30, 2025, the Group had no concrete plans for any major investments or acquisitions of capital assets, except those in the ordinary course of business[43](index=43&type=chunk) - The company will closely monitor market changes and actively explore investment opportunities to broaden its revenue base and enhance future financial performance and profitability[43](index=43&type=chunk) [Financial Review](index=16&type=section&id=Financial%20Review) H1 2025 revenue grew, but gross margin declined; other income improved, but expected credit losses increased; operating cash outflow, investment outflow rose, and financing inflow was substantial, increasing leverage [1. Revenue, Cost of Sales, Gross Profit](index=16&type=section&id=1.%20Revenue%2C%20Cost%20of%20Sales%2C%20Gross%20Profit) H1 2025 revenue increased by **10.77%** due to higher sales volumes, but gross margin decreased by **1.68** percentage points as cost of sales grew faster H1 2025 Revenue, Cost of Sales, Gross Profit | Indicator | H1 2025 (RMB thousands) | H1 2024 (RMB thousands) | Change Rate | | :--- | :--- | :--- | :--- | | Revenue | 1,405,188 | 1,268,564 | 10.77% | | Cost of Sales | 1,044,411 | 921,590 | 13.33% | | Gross Profit | 360,777 | 346,974 | 3.98% | | Gross Margin | 25.67% | 27.35% | Decreased by 1.68 percentage points | - The increase in revenue was primarily due to the combined effect of an **84 thousand tons** increase in high-purity iron sales and a **95 thousand tons** increase in external iron concentrate sales[44](index=44&type=chunk) - The increase in cost of sales was mainly influenced by higher sales volumes of high-purity iron and iron concentrate, despite a decrease in unit costs[44](index=44&type=chunk) [2. Other Income, Other Expenses, Other Gains and Losses, Expected Credit Losses](index=17&type=section&id=2.%20Other%20Income%2C%20Other%20Expenses%2C%20Other%20Gains%20and%20Losses%2C%20Expected%20Credit%20Losses) H1 2025 other income slightly decreased, other expenses doubled, other gains improved to a gain due to reduced impairment, while expected credit losses substantially increased H1 2025 Other Income, Expenses, Gains and Losses | Indicator | H1 2025 (RMB thousands) | H1 2024 (RMB thousands) | Change Rate | | :--- | :--- | :--- | :--- | | Other Income | 5,077 | 5,587 | (9.13%) | | Other Expenses | 409 | 200 | 104.50% | | Other Gains or Losses | 5,242 (Gain) | (3,348) (Loss) | Increased by 8,590 thousand or 256.57% | | Impairment losses under expected credit loss model | 5,964 (Loss) | (5,442) (Reversal) | Increased by 11,406 thousand or 209.59% | - Other gains or losses turned into a gain, primarily due to the impairment of interests in an associate of **RMB 5,976 thousand** recognized in the prior year period[48](index=48&type=chunk) - Impairment losses under the expected credit loss model significantly increased, reflecting higher impairment provisions for receivables[48](index=48&type=chunk) [3. Distribution and Selling Expenses, Administrative Expenses](index=18&type=section&id=3.%20Distribution%20and%20Selling%20Expenses%2C%20Administrative%20Expenses) H1 2025 distribution and selling expenses increased by **24.43%** due to higher sales volumes, while administrative expenses remained relatively stable H1 2025 Distribution and Selling Expenses, Administrative Expenses | Indicator | H1 2025 (RMB thousands) | H1 2024 (RMB thousands) | Change Rate | | :--- | :--- | :--- | :--- | | Distribution and Selling Expenses | 50,701 | 40,747 | 24.43% | | Administrative Expenses | 101,450 | 101,101 | 0.35% | - The increase in distribution and selling expenses was primarily due to higher sales volumes of high-purity iron and iron concentrate[50](index=50&type=chunk) [4. Finance Costs, Income Tax Expense](index=18&type=section&id=4.%20Finance%20Costs%2C%20Income%20Tax%20Expense) H1 2025 finance costs increased by **3.52%** due to higher borrowings, and income tax expense also rose by **4.50%** H1 2025 Finance Costs, Income Tax Expense | Indicator | H1 2025 (RMB thousands) | H1 2024 (RMB thousands) | Change Rate | | :--- | :--- | :--- | :--- | | Finance Costs | 37,154 | 35,892 | 3.52% | | Income Tax Expense | 70,424 | 67,394 | 4.50% | - The increase in finance costs was primarily due to higher interest expenses resulting from increased borrowings[51](index=51&type=chunk) [5. Profit for the Period and Total Comprehensive Income](index=18&type=section&id=5.%20Profit%20for%20the%20Period%20and%20Total%20Comprehensive%20Income) H1 2025 profit for the period slightly decreased by **1.99%**, while total comprehensive income significantly increased by **30.87%**, primarily due to foreign currency translation adjustments H1 2025 Profit for the Period and Total Comprehensive Income | Indicator | H1 2025 (RMB thousands) | H1 2024 (RMB thousands) | Change Rate | | :--- | :--- | :--- | :--- | | Profit for the Period | 104,537 | 106,658 | (1.99%) | | Total Comprehensive Income | 127,974 | 97,790 | 30.87% | - The increase in total comprehensive income was primarily influenced by foreign currency translation adjustments[52](index=52&type=chunk) [6. Property, Plant and Equipment, Inventories, Intangible Assets](index=19&type=section&id=6.%20Property%2C%20Plant%20and%20Equipment%2C%20Inventories%2C%20Intangible%20Assets) As of June 30, 2025, PPE slightly decreased, inventories declined, while intangible assets substantially increased by **131.56%** due to a cancelled disposal and higher mining expenditures H1 2025 Asset Changes | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change Rate | | :--- | :--- | :--- | :--- | | Net Property, Plant and Equipment | 617,818 | 654,085 | (5.54%) | | Inventories | 183,419 | 261,314 | (29.81%) | | Intangible Assets | 647,570 | 279,655 | 131.56% | - The decrease in inventories was primarily due to lower unit costs and reduced inventory volumes in the high-purity iron business[53](index=53&type=chunk) - The significant increase in intangible assets was mainly due to the cancellation of the Primary Gold Pty Ltd disposal transaction, leading to the reclassification of related assets, and increased expenditures on iron and gold mining rights and exploration[53](index=53&type=chunk) [7. Trade and Other Receivables, Trade and Other Payables](index=19&type=section&id=7.%20Trade%20and%20Other%20Receivables%2C%20Trade%20and%20Other%20Payables) As of June 30, 2025, trade receivables and bills receivable significantly increased, while trade and other payables slightly decreased H1 2025 Receivables/Payables Changes | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change Rate | | :--- | :--- | :--- | :--- | | Trade Receivables | 271,546 | 156,299 | 73.73% | | Other Receivables | 67,680 | 66,332 | 2.03% | | Bills Receivable | 463,204 | 286,076 | 61.92% | | Trade Payables | 184,925 | 195,391 | (5.36%) | | Other Payables | 112,109 | 129,160 | (13.20%) | - The increase in trade receivables was primarily due to higher trade receivables in the high-purity iron segment[54](index=54&type=chunk) - The increase in bills receivable was mainly due to a higher volume of bills received during the period that have not yet been discounted or endorsed[54](index=54&type=chunk) [8. Cash Flow Analysis](index=20&type=section&id=8.%20Cash%20Flow%20Analysis) H1 2025 saw net cash outflows from operating and investing activities, significant net cash inflows from financing, and a net increase in cash and cash equivalents H1 2025 Consolidated Cash Flow Statement Summary | Indicator | H1 2025 (RMB thousands) | H1 2024 (RMB thousands) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | (126,045) (Outflow) | 98,608 (Inflow) | | Net Cash Flow from Investing Activities | (342,580) (Outflow) | 10,146 (Inflow) | | Net Cash Flow from Financing Activities | 559,290 (Inflow) | (35,239) (Outflow) | | Net Increase in Cash and Cash Equivalents | 90,665 | 73,515 | - Net cash outflow from operating activities was primarily affected by net changes in working capital and income tax payments offsetting profit before tax[57](index=57&type=chunk) - Net cash inflow from financing activities mainly resulted from new bank loans, discounted bills, and factoring of trade receivables[58](index=58&type=chunk) [9. Cash and Borrowings](index=21&type=section&id=9.%20Cash%20

[Financial Summary](index=1&type=section&id=Financial%20Summary) This section presents the company's key financial performance indicators for the reporting period [Key Financial Indicators](index=1&type=section&id=1.1%20Key%20Financial%20Indicators) For the six months ended June 30, 2025, the company reported revenue of RMB 5,850 million, net profit of RMB 641 million, and basic earnings per share of RMB 0.14 Key Financial Indicators for H1 2025 | Indicator | Amount (RMB million) | | :--- | :--- | | Revenue | 5,850 | | Gross Profit | 848 | | Net Profit Attributable to Owners of the Company | 641 | | Basic Earnings Per Share | RMB 0.14 | [Unaudited Interim Condensed Consolidated Financial Statements](index=2&type=section&id=Unaudited%20Interim%20Condensed%20Consolidated%20Financial%20Statements) This section details the company's unaudited interim consolidated financial statements, including income, balance sheet, and notes [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=2&type=section&id=2.1%20Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the six months ended June 30, 2025, the company's revenue was RMB 5,850 million, a 2.6% decrease year-on-year; net profit was RMB 723.8 million, down 2.6% year-on-year, with net profit attributable to owners at RMB 640.6 million, down 6.7% year-on-year Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the six months ended June 30) | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Sales Revenue | 5,850,248 | 6,006,640 | -2.6% | | Cost of Sales | (5,002,371) | (5,003,497) | -0.02% | | Gross Profit | 847,877 | 1,003,143 | -15.5% | | Net Profit for the Period | 723,765 | 743,374 | -2.6% | | Profit for the Period Attributable to Owners of the Company | 640,561 | 686,827 | -6.7% | | Basic and Diluted Earnings Per Share (RMB) | 0.14 | 0.15 | -6.7% | [Condensed Consolidated Statement of Financial Position](index=4&type=section&id=2.2%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the company's total assets were RMB 24,570.8 million, a 2.1% increase from the end of 2024, with net current assets at RMB 13,052.4 million and total equity at RMB 19,571.7 million Condensed Consolidated Statement of Financial Position (As of June 30) | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Total Assets | 24,570,791 | 24,075,995 | +2.1% | | Non-current Assets | 8,313,949 | 8,719,566 | -4.7% | | Current Assets | 16,256,842 | 15,356,429 | +5.9% | | Total Equity | 19,571,727 | 19,506,961 | +0.3% | | Total Liabilities | 4,999,064 | 4,569,034 | +9.4% | | Net Current Assets | 13,052,435 | 12,843,481 | +1.6% | [Notes to the Condensed Consolidated Financial Statements](index=7&type=section&id=2.3%20Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) This section details the company's basic information, accounting policies, operating segment performance, revenue composition, expenses, taxation, share capital, and related party transactions [Company Information and Basis of Preparation](index=7&type=section&id=2.3.1%20Company%20Information%20and%20Basis%20of%20Preparation) The company primarily engages in the production and sale of urea, methanol, phosphate fertilizers, compound fertilizers, and acrylonitrile, with its direct and ultimate holding company being China National Offshore Oil Corporation, and these interim financial statements are prepared in accordance with IAS 34 - The Group is principally engaged in the production and sale of urea, methanol, phosphate fertilizers (MAP, DAP), compound fertilizers, and acrylonitrile (AN)[14](index=14&type=chunk) - These condensed consolidated financial statements are prepared in accordance with International Accounting Standard 34 'Interim Financial Reporting' issued by the International Accounting Standards Board[14](index=14&type=chunk) [Principal Accounting Policies](index=7&type=section&id=2.3.2%20Principal%20Accounting%20Policies) These condensed consolidated financial statements adopt the same accounting policies as the previous year, incorporating new or revised International Financial Reporting Standards issued by the IASB, with no significant impact on accounting policies - These condensed consolidated financial statements are prepared on the historical cost basis, except for certain financial instruments measured at fair value[15](index=15&type=chunk) - The adoption of new or revised International Financial Reporting Standards (such as amendments to IAS 21) has no significant impact on the Group's accounting policies[15](index=15&type=chunk)[16](index=16&type=chunk) [Operating Segment Information](index=8&type=section&id=2.3.3%20Operating%20Segment%20Information) The company is divided into five operating segments: urea, phosphate and compound fertilizers, methanol, acrylonitrile, and others; in H1 2025, methanol contributed the most to profit before tax, while urea had the highest revenue but decreased year-on-year - The company's operating segments include urea, phosphate and compound fertilizers, methanol, acrylonitrile, and other segments[17](index=17&type=chunk)[19](index=19&type=chunk) Segment Revenue and Profit Before Tax (For the six months ended June 30) | Segment | 2025 Revenue (RMB thousand) | 2024 Revenue (RMB thousand) | Revenue Y-o-Y Change (%) | 2025 Profit Before Tax (RMB thousand) | 2024 Profit Before Tax (RMB thousand) | Profit Before Tax Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Urea | 1,660,765 | 2,102,435 | -21.0% | 122,469 | 372,632 | -67.1% | | Phosphate and Compound Fertilizers | 1,343,230 | 1,371,290 | -2.0% | 21,726 | 82,966 | -73.8% | | Methanol | 1,592,768 | 1,478,553 | +7.7% | 465,098 | 314,302 | +48.0% | | Acrylonitrile | 1,074,748 | 824,910 | +30.3% | 15,110 | 12,193 | +23.9% | | Others | 178,737 | 229,452 | -22.1% | (68,247) | (67,889) | +0.5% | | **Total** | **5,850,248** | **6,006,640** | **-2.6%** | **556,156** | **714,204** | **-22.1%** | - Management decided to disclose BB fertilizer as a new segment and re-presented comparative data for the phosphate and compound fertilizers segment and other segments[24](index=24&type=chunk) [Sales Revenue and Other Income](index=11&type=section&id=2.3.4%20Sales%20Revenue%20and%20Other%20Income) Sales revenue for H1 2025 was RMB 5,850.2 million, a 2.6% year-on-year decrease, while other income decreased by 22.7% to RMB 25.2 million, primarily due to reduced income from labor services and material sales Sales Revenue and Other Income Analysis (For the six months ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Sales Revenue | 5,850,248 | 6,006,640 | -2.6% | | Other Income | 25,160 | 32,550 | -22.7% | - The decrease in other income was primarily due to a reduction of **RMB 2.2 million** in labor service income and **RMB 3.6 million** in material sales income[62](index=62&type=chunk) [Other Gains and Losses](index=11&type=section&id=2.3.5%20Other%20Gains%20and%20Losses) Other gains and losses significantly increased to RMB 83.7 million in H1 2025, a 4,085.0% year-on-year growth, primarily driven by gains from the disposal of assets due to shantytown renovation and expropriation by Basuo Port Company Other Gains and Losses (For the six months ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Gain on Disposal of Property, Plant and Equipment | 5,463 | 2,019 | +170.6% | | Gain on Disposal of Prepaid Lease Payments | 78,253 | – | N/A | | **Total** | **83,716** | **2,019** | **+4085.0%** | - The significant increase in other gains and losses was primarily due to an increase of **RMB 77.9 million** from the disposal of assets due to shantytown renovation and expropriation by Basuo Port Company[63](index=63&type=chunk) [Profit Before Tax](index=12&type=section&id=2.3.6%20Profit%20Before%20Tax) Profit before tax for the period has been deducted for cost of sales, depreciation, and amortization, with cost of sales remaining largely flat year-on-year and total depreciation and amortization decreasing Items Deducted/Included in Profit Before Tax (For the six months ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Cost of Sales Recognized as Expense | 5,002,371 | 5,003,497 | -0.02% | | Total Depreciation and Amortization | 331,198 | 362,856 | -8.6% | | Reversal of Impairment Loss on Trade Receivables | (17) | (177) | -90.4% | [Income Tax Expense](index=13&type=section&id=2.3.7%20Income%20Tax%20Expense) Income tax expense for H1 2025 was RMB 115.3 million, a 25.8% year-on-year decrease, primarily due to lower profit before tax, partially offset by increased tax expenses from asset disposal gains related to shantytown renovation Income Tax Expense (For the six months ended June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Current Income Tax | 117,541 | 155,893 | -24.6% | | Deferred Tax | (2,231) | (548) | +307.1% | | **Total** | **115,310** | **155,345** | **-25.8%** | - Chinese subsidiaries are subject to a **25%** tax rate, while certain subsidiaries in encouraged industries within the Hainan Free Trade Port enjoy a reduced corporate income tax rate of **15%**[30](index=30&type=chunk) - The decrease in income tax expense was primarily due to a **RMB 49.5 million** year-on-year reduction in operating profit before tax, partially offset by an **RMB 11.7 million** increase in current income tax expense from asset disposal gains related to shantytown renovation by Basuo Port Company[72](index=72&type=chunk) [Earnings Per Share Attributable to Owners of the Company](index=14&type=section&id=2.3.8%20Earnings%20Per%20Share%20Attributable%20to%20Owners%20of%20the%20Company) For the six months ended June 30, 2025, basic and diluted earnings per share attributable to owners of the company decreased to RMB 0.14 from RMB 0.15 in the prior period Earnings Per Share (For the six months ended June 30) | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Net Profit for the Period Attributable to Owners of the Company (RMB thousand) | 640,561 | 686,827 | | Number of Ordinary Shares Issued (thousand shares) | 4,610,000 | 4,610,000 | | Basic and Diluted Earnings Per Share (RMB) | 0.14 | 0.15 | - The Group had no potential dilutive shares during the reporting period, thus diluted earnings per share were the same as basic earnings per share[33](index=33&type=chunk) [Prepaid Lease Payments](index=14&type=section&id=2.3.9%20Prepaid%20Lease%20Payments) In H1 2025, the Group did not acquire new land use rights and disposed of prepaid lease payments with a carrying value of RMB 1,847,000 - The Group did not acquire any new land use rights in H1 2025[32](index=32&type=chunk) - The Group disposed of prepaid lease payments with a carrying value of **RMB 1,847,000**[32](index=32&type=chunk) [Interests in Joint Ventures](index=15&type=section&id=2.3.10%20Interests%20in%20Joint%20Ventures) As of June 30, 2025, the Group's interests in joint ventures increased to RMB 396.9 million from the end of 2024, primarily including Guizhou Jinlin Chemical and CNOOC Chemical (Canada) Holdings Interests in Joint Ventures | Indicator | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Interests in Joint Ventures | 396,863 | 333,906 | - Key joint ventures include Guizhou Jinlin Chemical Co., Ltd. (**33.99% stake**) and CNOOC Chemical (Canada) Holdings Co., Ltd. (**60.00% stake**)[34](index=34&type=chunk) - The company has joint control over CNOOC Chemical (Canada), thus it is classified as a joint venture[34](index=34&type=chunk) [Interests in Associates](index=16&type=section&id=2.3.11%20Interests%20in%20Associates) As of June 30, 2025, the Group's interests in associates amounted to RMB 129.5 million, including Guangxi Huiduoli Agricultural Technology and PetroChina (Inner Mongolia) New Materials Interests in Associates | Indicator | June 30, 2025 (RMB thousand) | December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Interests in Associates | 129,546 | 127,404 | - Key associates include Guangxi Huiduoli Agricultural Technology Co., Ltd. (**34.00% stake**), PetroChina (Inner Mongolia) New Materials Co., Ltd. (**25.27% stake**), and United Huinong Agricultural Materials (Beijing) Co., Ltd. (**30.00% stake**)[35](index=35&type=chunk) [Loans Receivable](index=17&type=section&id=2.3.12%20Loans%20Receivable) As of June 30, 2025, total loans receivable were RMB 208.3 million, all current and due within one year, a reclassification from non-current at the end of 2024 Loans Receivable (As of June 30) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Unsecured Loans - Principal | 208,252 | 208,252 | | Due within one year | 208,252 | – | | Due after one year but within two years | – | 208,252 | | Current portion | 208,252 | – | | Non-current portion | – | 208,252 | - Loans receivable are unsecured, bear interest at the five-year Loan Prime Rate minus **1.75%**, and are repayable on May 8, 2026[37](index=37&type=chunk) [Trade Receivables](index=18&type=section&id=2.3.13%20Trade%20Receivables) As of June 30, 2025, trade receivables significantly increased to RMB 109.8 million from the end of 2024, with amounts due from certain CNOOC Group companies accounting for the largest portion Aging Analysis of Trade Receivables (As of June 30) | Aging | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Within one year | 106,950 | 20,777 | | Over three years | 2,884 | 2,310 | | **Total** | **109,834** | **23,621** | Trade Receivables from Related Parties (As of June 30) | Related Party | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Certain CNOOC Group Companies | 78,212 | 9,065 | | Associates | 2,844 | 2,844 | | Joint Ventures | 1,111 | 1,714 | | **Total** | **82,167** | **13,623** | - The Group's sales of products such as urea, methanol, acrylonitrile, monoammonium phosphate, and diammonium phosphate are primarily settled through advance payments, while export sales accept irrevocable letters of credit[39](index=39&type=chunk) [Bills Receivable](index=19&type=section&id=2.3.14%20Bills%20Receivable) As of June 30, 2025, all of the Group's bills receivable were due within twelve months, with no endorsement of bills receivable to settle trade payables during the period, a significant decrease compared to the prior period - All of the Group's bills receivable as of June 30, 2025, and December 31, 2024, were due within twelve months[41](index=41&type=chunk) - For the six months ended June 30, 2025, the Group did not endorse any bills receivable due within twelve months to settle trade payables (December 31, 2024: **RMB 101,547,000**)[41](index=41&type=chunk) [Proposed Dividends](index=19&type=section&id=2.3.15%20Proposed%20Dividends) The Board does not recommend an interim dividend for H1 2025; the company distributed 2024 annual dividends totaling RMB 556.9 million in H1 2025 - The Board of Directors does not recommend the payment of an interim dividend for the six months ended June 30, 2025[43](index=43&type=chunk) - The company distributed a 2024 annual dividend of **RMB 0.1208 per share** in H1 2025, totaling **RMB 556,888,000**[43](index=43&type=chunk) - A **10%** corporate income tax is withheld when dividends are paid to non-Chinese resident enterprise shareholders[43](index=43&type=chunk) [Trade Payables](index=20&type=section&id=2.3.16%20Trade%20Payables) As of June 30, 2025, trade payables were RMB 1,023.0 million, a slight decrease from the end of 2024, with amounts due to certain CNOOC Group companies accounting for the largest portion Aging Analysis of Trade Payables (As of June 30) | Aging | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Within one year | 1,020,751 | 1,022,590 | | Over one year but within two years | 751 | 42,349 | | **Total** | **1,022,988** | **1,067,996** | Trade Payables to Related Parties (As of June 30) | Related Party | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Certain CNOOC Group Companies | 433,344 | 364,373 | | Joint Ventures | 3,338 | 71 | | Other Related Parties | 1,214 | 6,346 | | **Total** | **437,896** | **370,790** | - Trade payables are unsecured, non-interest bearing, and generally have repayment terms ranging from **30 to 180 days**[44](index=44&type=chunk) [Management Discussion and Analysis](index=21&type=section&id=Management%20Discussion%20and%20Analysis) This section provides an overview of the company's operational and financial performance, industry trends, and future outlook [Industry Review](index=21&type=section&id=3.1%20Industry%20Review) In H1 2025, the fertilizer market experienced significant price fluctuations, with urea prices falling 19% year-on-year, while phosphate fertilizer prices remained high and increased; the chemical industry faced overall pressure, with methanol prices fluctuating and acrylonitrile prices declining by 5.4% year-on-year due to oversupply [Fertilizer Industry](index=21&type=section&id=3.1.1%20Fertilizer%20Industry) The urea market experienced significant fluctuations due to supply, demand, and policy, with average prices falling 19% year-on-year in H1; phosphate fertilizer prices remained generally high, with monoammonium phosphate up 6.48% and diammonium phosphate up 1.59% year-on-year - The average price of urea in H1 was **RMB 1,804/ton**, a year-on-year decrease of **RMB 434/ton**, representing a **19% decline**[46](index=46&type=chunk) - The average price of monoammonium phosphate was **RMB 3,268/ton**, a year-on-year increase of **6.48%**[47](index=47&type=chunk) - The average price of diammonium phosphate was **RMB 3,954/ton**, a year-on-year increase of **1.59%**[48](index=48&type=chunk) [Chemical Industry](index=22&type=section&id=3.1.2%20Chemical%20Industry) The chemical industry faced overall pressure from international oil prices and trade policies; methanol prices fluctuated, while acrylonitrile prices declined by 5.4% year-on-year in H1 due to oversupply - In H1 2025, domestic chemical industry prices remained under pressure due to a downward shift in international oil prices and increased disruptions from tariffs and other trade policies[49](index=49&type=chunk) - The average price of acrylonitrile in H1 was **RMB 9,350.41/ton**, a **5.4% decrease** from **RMB 9,888.10/ton** in the prior period[51](index=51&type=chunk) - The core reason for the decline in acrylonitrile's average price is that the increase in industry consumption lagged behind the increase in supply, exacerbating the oversupply situation[52](index=52&type=chunk) [Business Review](index=23&type=section&id=3.2%20Business%20Review) In H1, the company strengthened production and operation management, achieving record high methanol output and port throughput, successfully produced the first domestic green methanol, and maintained 100% compliance in pollutant emissions for three consecutive years [Operating Results](index=23&type=section&id=3.2.1%20Operating%20Results) In H1, the company produced 968,000 tons of urea, 781,000 tons of methanol, 450,000 tons of phosphate and compound fertilizers, and 132,000 tons of acrylonitrile series products, while selling 996,000 tons of urea, 726,000 tons of methanol, 386,000 tons of phosphate and compound fertilizers, and 127,000 tons of acrylonitrile series products - Hainan Fudao's methanol output and Basuo Port's cumulative throughput both reached **record highs** for the same period[53](index=53&type=chunk) - The company successfully produced the **first ton of green methanol in China** using municipal waste as raw material, obtained International Sustainability and Carbon Certification (ISCC), and successfully applied it to domestic dual-fuel vessels[53](index=53&type=chunk) [Green Development and Environmental Protection](index=23&type=section&id=3.2.2%20Green%20Development%20and%20Environmental%20Protection) In H1, the company integrated monitoring data into its environmental information system, achieved 100% compliance in pollutant emissions for three consecutive years with zero environmental pollution incidents, and increased the comprehensive utilization rate of phosphogypsum at Dayukou Chemical to 73.09% - The company achieved unified access of monitoring data to the environmental information system, with **100% compliance in pollutant emissions for three consecutive years** and **zero environmental pollution incidents**[54](index=54&type=chunk) - Dayukou Chemical's comprehensive utilization rate of phosphogypsum increased from **61.15% to 73.09%**, exceeding target requirements[54](index=54&type=chunk) [Production and Sales Volume of Major Products](index=24&type=section&id=3.2.3%20Production%20and%20Sales%20Volume%20of%20Major%20Products) In H1 2025, production and sales volumes of urea, methanol, and acrylonitrile series products all increased year-on-year, with acrylonitrile series products showing significant growth, while phosphate and compound fertilizers saw slight increases Production and Sales Volume of Major Products (For the six months ended June 30) | Product | 2025 Production Volume (tons) | 2025 Sales Volume (tons) | 2024 Production Volume (tons) | 2024 Sales Volume (tons) | Production Y-o-Y Change (%) | Sales Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Urea | 967,647 | 995,833 | 973,476 | 1,003,262 | -0.6% | -0.7% | | Phosphate and Compound Fertilizers | 449,628 | 385,801 | 445,081 | 401,005 | +1.0% | -3.8% | | Methanol | 781,466 | 726,174 | 706,984 | 668,460 | +10.5% | +8.6% | | Acrylonitrile Series | 132,178 | 127,344 | 97,491 | 88,418 | +35.6% | +44.0% | | BB Fertilizer | 13,396 | 11,155 | N/A | N/A | N/A | N/A | [Financial Review](index=25&type=section&id=3.3%20Financial%20Review) In H1 2025, the company's total revenue and net profit both decreased year-on-year, with reduced revenue from urea and phosphate/compound fertilizers offset by increases from methanol and acrylonitrile series products, leading to a 15.5% decline in gross profit, while other gains and losses significantly increased due to asset disposal gains, and the company maintained sound financial resources with ample cash and cash equivalents [Revenue and Gross Profit](index=25&type=section&id=3.3.1%20Revenue%20and%20Gross%20Profit) The Group's revenue decreased by 2.6% year-on-year to RMB 5,850.2 million, primarily due to a significant drop in urea sales prices, and gross profit decreased by 15.5% to RMB 847.9 million, mainly due to reduced gross profit from urea and phosphate/compound fertilizers, partially offset by increased methanol gross profit Revenue Change by Product (For the six months ended June 30) | Product | 2025 Revenue (RMB million) | 2024 Revenue (RMB million) | Y-o-Y Change (%) | Primary Reason | | :--- | :--- | :--- | :--- | :--- | | Urea | 1,660.8 | 2,102.4 | -21.0% | Decrease in sales price (RMB 426.1 million) and lower sales volume (RMB 15.5 million) | | Phosphate and Compound Fertilizers | 1,343.2 | 1,371.3 | -2.0% | Decrease in sales volume (RMB 9.6 million) and lower sales price (RMB 18.5 million) | | Methanol | 1,592.8 | 1,478.6 | +7.7% | Increase in sales volume (RMB 127.6 million) offset by decrease in sales price (RMB 13.4 million) | | Acrylonitrile Series Products | 1,074.7 | 824.9 | +30.3% | Increase in sales volume (RMB 363.1 million) offset by decrease in sales price (RMB 113.3 million) | | Other Businesses | 178.7 | 229.5 | -22.1% | Decrease in trading volume (RMB 51.0 million) | | **Total** | **5,850.2** | **6,006.6** | **-2.6%** | | - Gross profit decreased by **15.5%**, primarily due to a **RMB 263.5 million** reduction in urea gross profit, a **RMB 73.1 million** reduction in phosphate and compound fertilizer gross profit, and a **RMB 3.3 million** reduction in acrylonitrile series products gross profit, partially offset by a **RMB 149.3 million** increase in methanol gross profit and a **RMB 35.4 million** increase in other business gross profit[61](index=61&type=chunk) [Other Income and Other Gains and Losses](index=26&type=section&id=3.3.2%20Other%20Income%20and%20Other%20Gains%20and%20Losses) Other income decreased by 22.7% year-on-year to RMB 25.2 million, mainly due to reduced income from labor services and material sales, while other gains and losses surged by 4,085.0% to RMB 83.7 million, primarily driven by asset disposal gains from shantytown renovation by Basuo Port Company Changes in Other Income and Other Gains and Losses (For the six months ended June 30) | Item | 2025 (RMB million) | 2024 (RMB million) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Other Income | 25.2 | 32.6 | -22.7% | | Other Gains and Losses | 83.7 | 2.0 | +4085.0% | - The significant increase in other gains and losses was primarily due to a year-on-year increase of **RMB 77.9 million** from the disposal of assets due to shantytown renovation and expropriation by Basuo Port Company[63](index=63&type=chunk) [Selling and Distribution Costs](index=27&type=section&id=3.3.3%20Selling%20and%20Distribution%20Costs) Selling and distribution costs decreased by 16.3% year-on-year to RMB 33.5 million, primarily due to reduced personnel costs and promotional expenses for sales organizations Changes in Selling and Distribution Costs (For the six months ended June 30) | Item | 2025 (RMB million) | 2024 (RMB million) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Selling and Distribution Costs | 33.5 | 40.0 | -16.3% | - The decrease in selling and distribution costs was primarily due to a year-on-year reduction of **RMB 3.4 million** in personnel costs for sales organizations and **RMB 1.1 million** in promotional expenses[64](index=64&type=chunk) [Administrative Expenses](index=27&type=section&id=3.3.4%20Administrative%20Expenses) Administrative expenses were RMB 283.4 million, a slight year-on-year increase of 0.7%, remaining largely stable Changes in Administrative Expenses (For the six months ended June 30) | Item | 2025 (RMB million) | 2024 (RMB million) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Administrative Expenses | 283.4 | 281.5 | +0.7% | [Other Expenses](index=27&type=section&id=3.3.5%20Other%20Expenses) Other expenses significantly increased by 938.5% to RMB 27.0 million, primarily due to a year-on-year increase in external donations Changes in Other Expenses (For the six months ended June 30) | Item | 2025 (RMB million) | 2024 (RMB million) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Other Expenses | 27.0 | 2.6 | +938.5% | - The increase in other expenses was primarily due to a year-on-year increase of **RMB 25.0 million** in external donations during the current year[66](index=66&type=chunk) [Finance Income and Finance Costs](index=27&type=section&id=3.3.6%20Finance%20Income%20and%20Finance%20Costs) Finance income decreased by 5.6% year-on-year to RMB 162.9 million, mainly from large-denomination deposit certificates, while finance costs decreased by 9.6% to RMB 24.4 million, primarily due to lower loan interest rates Changes in Finance Income and Finance Costs (For the six months ended June 30) | Item | 2025 (RMB million) | 2024 (RMB million) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Finance Income | 162.9 | 172.6 | -5.6% | | Finance Costs | 24.4 | 27.0 | -9.6% | - Finance income from large-denomination deposit certificates amounted to **RMB 156.6 million**[67](index=67&type=chunk) - The decrease in finance costs was primarily due to a year-on-year reduction in loan interest rates[67](index=67&type=chunk) [Net Exchange Differences](index=28&type=section&id=3.3.7%20Net%20Exchange%20Differences) The Group recorded a net exchange gain of RMB 0.8 million, a significant improvement from a net loss of RMB 5.9 million in the prior period, mainly due to exchange rate fluctuations between the declaration and payment of H-share dividends Changes in Net Exchange Differences (For the six months ended June 30) | Item | 2025 (RMB million) | 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Net Exchange Differences | +0.8 (Gain) | -5.9 (Loss) | Increase in gain of RMB 6.7 million | - The net exchange gain was primarily due to significant exchange rate fluctuations between the declaration and payment of H-share dividends in the prior year[69](index=69&type=chunk) [Share of Net Profit or Loss of Associates and Joint Ventures](index=28&type=section&id=3.3.8%20Share%20of%20Net%20Profit%20or%20Loss%20of%20Associates%20and%20Joint%20Ventures) Share of profit from associates and joint ventures significantly increased by 1,384.1% to RMB 65.3 million, primarily due to a substantial improvement in the operating performance of Guizhou Jinlin Chemical Co., Ltd Changes in Share of Net Profit or Loss of Associates and Joint Ventures (For the six months ended June 30) | Item | 2025 (RMB million) | 2024 (RMB million) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Share of Profit from Associates and Joint Ventures | 65.3 | 4.4 | +1384.1% | - The increase in profit was primarily due to a significant year-on-year improvement in the operating performance of Guizhou Jinlin Chemical Co., Ltd., with an additional **RMB 58.5 million** in investment income recognized from it this year[71](index=71&type=chunk) [Income Tax Expense](index=28&type=section&id=3.3.9%20Income%20Tax%20Expense) Income tax expense for H1 2025 was RMB 115.3 million, a 25.8% year-on-year decrease, primarily due to lower profit before tax, partially offset by increased tax expenses from asset disposal gains related to shantytown renovation Changes in Income Tax Expense (For the six months ended June 30) | Item | 2025 (RMB million) | 2024 (RMB million) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Income Tax Expense | 115.3 | 155.3 | -25.8% | - The decrease in income tax expense was primarily due to a year-on-year reduction in the Group's operating profit before tax, resulting in a **RMB 49.5 million** decrease in current income tax expense, partially offset by an **RMB 11.7 million** increase in current income tax expense from asset disposal gains related to shantytown renovation by Basuo Port Company[72](index=72&type=chunk) [Net Profit for the Period](index=28&type=section&id=3.3.10%20Net%20Profit%20for%20the%20Period) The Group's net profit for the period was RMB 723.8 million, a 2.6% year-on-year decrease Changes in Net Profit for the Period (For the six months ended June 30) | Item | 2025 (RMB million) | 2024 (RMB million) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Net Profit | 723.8 | 743.4 | -2.6% | [Dividends](index=28&type=section&id=3.3.11%20Dividends) The Board does not recommend an interim dividend for H1 2025; the company distributed 2024 annual dividends totaling RMB 556.9 million in cash during the reporting period - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025[74](index=74&type=chunk) - During the reporting period, the company distributed 2024 dividends totaling **RMB 556.9 million** in cash[74](index=74&type=chunk) [Capital Expenditure](index=29&type=section&id=3.3.12%20Capital%20Expenditure) During the reporting period, the Group's capital expenditure totaled RMB 78.76 million, primarily allocated to mid-to-downstream construction projects, technological transformation projects, and energy-saving, safety, and environmental protection projects Composition of Capital Expenditure (For the six months ended June 30) | Item | Amount (RMB million) | | :--- | :--- | | Mid-to-Downstream Construction Projects | 49.76 | | Base Construction (Production Support) | 0.37 | | Technological Transformation Projects | 16.82 | | Energy-Saving, Safety, and Environmental Protection Projects | 4.07 | | Information Technology Construction, Electronic Office Equipment | 6.71 | | Research Projects (Capital Expenditure) | 1.03 | | **Total** | **78.76** | - Key projects include the second phase of Dayukou Company's Phosphogypsum Dry Stacking Project (**RMB 27.83 million**) and Dayukou Company's 1.6 million tons/year Underground Phosphate Mining Project (**RMB 19.48 million**)[75](index=75&type=chunk) [Pledge of Assets](index=29&type=section&id=3.3.13%20Pledge%20of%20Assets) As of June 30, 2025, the Group had no property, plant, and equipment pledged as collateral for interest-bearing bank borrowings - As of June 30, 2025, the Group had no property, plant, and equipment pledged as collateral for interest-bearing bank borrowings[76](index=76&type=chunk) [Capital Management](index=29&type=section&id=3.3.14%20Capital%20Management) The Group's capital management aims to maintain a high credit rating and sound capital structure; as of June 30, 2025, total interest-bearing debt was RMB 2,335.2 million, with a capital gearing ratio of 10.7% - The Group's primary objective in capital management is to maintain a high credit rating and a sound capital structure to ensure normal operations and maximize shareholder value[77](index=77&type=chunk) - As of June 30, 2025, the Group's total interest-bearing debt was **RMB 2,335.2 million**, all of which were floating-rate liabilities[77](index=77&type=chunk) - The Group's capital gearing ratio as of June 30, 2025, was **10.7%**[77](index=77&type=chunk) [Cash and Cash Equivalents](index=30&type=section&id=3.3.15%20Cash%20and%20Cash%20Equivalents) As of June 30, 2025, the Group's cash and cash equivalents decreased to RMB 533.1 million from the beginning of the year but still maintained ample liquidity Changes in Cash and Cash Equivalents (H1 2025) | Item | Amount (RMB million) | | :--- | :--- | | Cash and cash equivalents at beginning of year | 679.9 | | Net cash inflow from operating activities | 584.8 | | Net cash outflow from investing activities | (249.5) | | Net cash outflow from financing activities | (482.0) | | Decrease due to exchange rate changes | (0.1) | | **Cash and cash equivalents at end of period** | **533.1** | - The Group holds ample liquidity to meet its daily operational and future development funding needs[78](index=78&type=chunk) [Human Resources and Training](index=30&type=section&id=3.4%20Human%20Resources%20and%20Training) As of June 30, 2025, the Group had 3,675 employees, with total wages and allowances of approximately RMB 439.9 million in H1, and the company maintains a comprehensive compensation system, systematic welfare plans, and extensive safety training programs - As of June 30, 2025, the Group had **3,675 employees**, and total wages and allowances for employees in H1 2025 amounted to approximately **RMB 439.9 million**[79](index=79&type=chunk) - The company has a comprehensive compensation system, systematic welfare plans, and an effective performance evaluation system[79](index=79&type=chunk) - As of June 30, 2025, the company conducted **41,140 person-times** of training, totaling **169,305 class hours**, including **34,557 person-times** and **99,363 class hours** for safety training[79](index=79&type=chunk) [Market Risks](index=30&type=section&id=3.5%20Market%20Risks) The Group faces market risks including commodity price risk from product sales prices and raw material/fuel costs, interest rate risk from floating-rate debt, and foreign exchange risk from RMB/USD fluctuations, while inflation had no significant impact on operating performance [Commodity Price Risk](index=30&type=section&id=3.5.1%20Commodity%20Price%20Risk) The Group is exposed to commodity price risk arising from changes in the selling prices of its major products and the costs of raw materials (natural gas, coal, phosphate rock, liquid ammonia, and sulfur) and fuels (natural gas and coal) - The Group's primary market risks are changes in the selling prices of major products, costs of raw materials (natural gas, coal, phosphate rock, liquid ammonia, and sulfur), and costs of fuels (natural gas and coal) and power[80](index=80&type=chunk)[81](index=81&type=chunk) [Interest Rate Risk](index=30&type=section&id=3.5.2%20Interest%20Rate%20Risk) The Group's market interest rate risk primarily stems from its short-term and long-term debt obligations bearing floating interest rates - The Group's market interest rate risk primarily arises from its short-term and long-term debt obligations bearing floating interest rates[82](index=82&type=chunk) [Foreign Exchange Risk](index=31&type=section&id=3.5.3%20Foreign%20Exchange%20Risk) The Group's sales revenue and procurement are primarily denominated in RMB and USD, and fluctuations in the RMB/USD exchange rate impact imports, exports, and USD financing; as of June 30, 2025, USD deposits totaled 10.1 million USD - The Group's sales revenue and procurement are primarily denominated in RMB and USD[83](index=83&type=chunk) - Fluctuations in the RMB/USD exchange rate can impact the company's equipment and raw material imports, product exports, and USD financing[83](index=83&type=chunk) - As of June 30, 2025, the Group's USD deposit balance was **10.1 million USD**, and HKD deposit balance was **2.0 million HKD**[83](index=83&type=chunk) [Inflation and Currency Risk](index=31&type=section&id=3.5.4%20Inflation%20and%20Currency%20Risk) During the reporting period, China's Consumer Price Index decreased by 0.1% year-on-year, which did not have a significant impact on the Group's operating performance - During the reporting period, China's Consumer Price Index decreased by **0.1%** year-on-year, which did not have a significant impact on the Group's operating performance[84](index=84&type=chunk) [Subsequent Events, Contingent Liabilities, and Litigation](index=31&type=section&id=3.6%20Subsequent%20Events%2C%20Contingent%20Liabilities%2C%20and%20Litigation) From the end of the reporting period to the announcement date, the Group had no significant subsequent events, contingent liabilities, major litigation, arbitration matters, or significant acquisitions and disposals - No significant events occurred from the end of the reporting period to the date of this announcement[85](index=85&type=chunk) - During the reporting period, the Group had no significant contingent liabilities[86](index=86&type=chunk) - During the reporting period, the Group had no major litigation or arbitration matters, nor any acquisitions or disposals of subsidiaries and associates[87](index=87&type=chunk)[88](index=88&type=chunk) [H2 2025 Industry Outlook](index=32&type=section&id=3.7%20H2%202025%20Industry%20Outlook) In H2 2025, the urea market is expected to remain in oversupply, with prices potentially rising in Q3 but facing pressure in Q4; monoammonium phosphate prices may fluctuate narrowly at high levels, diammonium phosphate market to stabilize, methanol supply to remain loose with wide price fluctuations, and acrylonitrile oversupply to intensify, requiring mainstream enterprises to reduce plant loads for price improvement - In H2 2025, urea will remain in a capacity expansion cycle, and the market as a whole is expected to continue in an **oversupply** situation[89](index=89&type=chunk) - Monoammonium phosphate prices may show **high-level, narrow fluctuations**, while the diammonium phosphate market is expected to maintain a **stable and consolidating trend**[89](index=89&type=chunk) - Methanol supply will remain **loose** in H2, with overall price movements characterized by **wide fluctuations**; the oversupply of acrylonitrile will further intensify, and price improvement will depend on domestic mainstream enterprises reducing plant loads[89](index=89&type=chunk) [Company's Key Initiatives for H2 2025](index=33&type=section&id=3.8%20Company%27s%20Key%20Initiatives%20for%20H2%202025) The company's key initiatives for H2 include improving equipment management, enhancing marketing and value creation, advancing 'AI+' initiatives, promoting research on carbon-rich natural gas utilization projects, strengthening brand value, and exploring green fuel industry investment opportunities - Improve the equipment management system to ensure safe and stable operation of facilities[90](index=90&type=chunk) - Focus on establishing quality positioning, expanding markets and sales, and enhancing marketing and value creation capabilities[90](index=90&type=chunk) - Advance the 'AI+' initiative to accelerate the deep integration of digital intelligence technology with the real economy[92](index=92&type=chunk) - Promote research on key projects for carbon-rich natural gas utilization and explore more investment opportunities in the green fuel industry[92](index=92&type=chunk) [Supplementary Information](index=33&type=section&id=Supplementary%20Information) This section provides additional details on corporate governance, compliance, and disclosure practices [Audit Committee](index=33&type=section&id=4.1%20Audit%20Committee) The Audit Committee reviewed the interim results and had no disagreements with external auditors, Mazars CPA Limited, on accounting treatments; the interim results are unaudited but have undergone an independent review - The Audit Committee, together with management, reviewed the accounting principles and standards adopted by the Group and discussed internal controls and financial reporting matters[90](index=90&type=chunk) - The interim results for the six months ended June 30, 2025, are unaudited but have undergone an independent review in accordance with Hong Kong Standard on Review Engagements 2410 issued by the Hong Kong Institute of Certified Public Accountants[90](index=90&type=chunk) - The Audit Committee and the independent auditor had no disagreements on the accounting treatments adopted for the preparation of the interim results for the reporting period[90](index=90&type=chunk) [Compliance with Corporate Governance Code](index=34&type=section&id=4.2%20Compliance%20with%20Corporate%20Governance%20Code) The company is committed to maintaining high standards of corporate governance; following Mr. Hou Xiaofeng's resignation as CEO and President on March 18, 2025, the company has re-complied with Code Provision C.2.1 of the Corporate Governance Code, and Mr. Hou, as Chairman, was unable to attend the 2025 AGM due to other commitments - The company is committed to maintaining high standards of corporate governance to enhance transparency and protect the overall interests of shareholders[91](index=91&type=chunk) - On March 18, 2025, Mr. Hou Xiaofeng resigned as the company's Chief Executive Officer and President, and the company has since re-complied with Code Provision C.2.1 of the Corporate Governance Code[93](index=93&type=chunk) - Mr. Hou Xiaofeng, the Chairman of the Board, was unable to attend the 2024 Annual General Meeting held on May 29, 2025, due to other commitments, and the meeting was chaired by Executive Director Ms. He Qunhui[94](index=94&type=chunk) [Compliance with the Model Code for Securities Transactions by Directors of Listed Issuers](index=34&type=section&id=4.3%20Compliance%20with%20the%20Model%20Code%20for%20Securities%20Transactions%20by%20Directors%20of%20Listed%20Issuers) The Board confirms that all directors and supervisors complied with the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix C3 of the Listing Rules for the six months ended June 30, 2025 - The Board confirms that all members of the Board and supervisors complied with the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix C3 of the Listing Rules for the six months ended June 30, 2025[95](index=95&type=chunk) [Purchase, Sale, and Redemption of the Company's Listed Securities](index=34&type=section&id=4.4%20Purchase%2C%20Sale%2C%20and%20Redemption%20of%20the%20Company%27s%20Listed%20Securities) Neither the company nor its subsidiaries purchased, sold, or redeemed any of the company's listed securities for the six months ended June 30, 2025 - Neither the company nor its subsidiaries purchased, sold, or redeemed any of the company's listed securities for the six months ended June 30, 2025[96](index=96&type=chunk) [Disclosure of Information on the HKEX Website](index=35&type=section&id=4.5%20Disclosure%20of%20Information%20on%20the%20HKEX%20Website) This results announcement has been published on the HKEXnews website and the company's website, and the 2025 interim report will be published in due course - This results announcement is published on the HKEXnews website (http://www.hkexnews.hk) and the company's website (http://www.chinabluechem.com.cn)[97](index=97&type=chunk) - The 2025 interim report will be published on HKEXnews and the company's website in due course[97](index=97&type=chunk)

[Financial Performance Summary](index=1&type=section&id=I.%20%E8%B2%A1%E5%8B%99%E6%A5%AD%E7%B8%BE%E6%91%98%E8%A6%81) This section provides a summary of key operational and financial indicators [Key Financial Indicators](index=1&type=section&id=1.1%20%E9%97%9C%E9%8D%B5%E8%B2%A1%E5%8B%99%E6%8C%87%E6%A8%99) This chapter summarizes key operational and financial indicators for the six months ended June 30, 2025, showing increased natural gas sales volume and revenue, but decreased profit before income tax and profit attributable to equity holders Key Financial Performance Summary for the Six Months Ended June 30 | Indicator | 2025 | 2024 | Change % | | :--- | :--- | :--- | :--- | | Total Natural Gas Sales Volume (million cubic meters) | 29,095 | 26,438 | 10.05 | | Natural Gas Retail Volume (million cubic meters) | 16,666 | 16,302 | 2.23 | | Revenue (RMB million) | 97,543 | 92,922 | 4.97 | | Profit Before Income Tax Expense (RMB million) | 6,737 | 7,249 | (7.06) | | Profit for the Period Attributable to Equity Holders (RMB million) | 3,161 | 3,305 | (4.36) | | Earnings Before Interest, Tax, Depreciation and Amortization (RMB million) | 9,523 | 9,915 | (3.95) | | Earnings Per Share (Basic) (RMB cents) | 36.51 | 38.17 | (4.35) | | Dividend Per Share - Interim (RMB cents) | 16.60 | 16.41 | 1.16 | [Unaudited Consolidated Interim Financial Statements](index=2&type=section&id=II.%20%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B6%9C%E5%90%88%E4%B8%AD%E6%9C%9F%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8) This section presents the unaudited consolidated interim financial statements [Unaudited Consolidated Interim Statement of Comprehensive Income](index=2&type=section&id=2.1%20%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B6%9C%E5%90%88%E4%B8%AD%E6%9C%9F%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) This chapter details the unaudited consolidated interim statement of comprehensive income for the six months ended June 30, 2025, outlining revenue, expenses, profit before tax, income tax, and profit for the period, allocated to equity holders and non-controlling interests Unaudited Consolidated Interim Statement of Comprehensive Income (For the Six Months Ended June 30) | Indicator | 2025 (RMB million) | 2024 (RMB million) | | :--- | :--- | :--- | | Revenue | 97,543 | 92,922 | | Other income, net | 381 | 746 | | Interest income | 337 | 499 | | Purchases, services and others | (84,778) | (79,752) | | Employee compensation costs | (2,850) | (3,169) | | Depreciation, depletion and amortization | (2,800) | (2,754) | | Other selling, general and administrative expenses | (1,121) | (1,230) | | Taxes other than income tax | (216) | (239) | | Interest expense | (323) | (411) | | Share of profit less loss: associates | 294 | 335 | | Share of profit less loss: joint ventures | 270 | 302 | | Profit before income tax expense | 6,737 | 7,249 | | Income tax expense | (1,735) | (1,929) | | Profit for the period | 5,002 | 5,320 | | Profit for the period attributable to equity holders of the Company | 3,161 | 3,305 | | Profit for the period attributable to non-controlling interests | 1,841 | 2,015 | | Total comprehensive income attributable to equity holders of the Company | 3,145 | 3,218 | | Total comprehensive income attributable to non-controlling interests | 1,825 | 2,013 | [Unaudited Consolidated Interim Statement of Financial Position](index=4&type=section&id=2.2%20%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B6%9C%E5%90%88%E4%B8%AD%E6%9C%9F%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) This chapter presents the unaudited consolidated interim statement of financial position as of June 30, 2025, and December 31, 2024, detailing non-current assets, current assets, equity, current liabilities, and non-current liabilities, reflecting changes in total assets and liabilities Unaudited Consolidated Interim Statement of Financial Position (As of June 30 and December 31) | Indicator | June 30, 2025 (RMB million) | December 31, 2024 (RMB million) | | :--- | :--- | :--- | | **ASSETS** | | | | Total non-current assets | 84,376 | 86,153 | | Total current assets | 56,449 | 57,237 | | **TOTAL ASSETS** | **140,825** | **143,390** | | **EQUITY** | | | | Capital and reserves attributable to equity holders of the Company | 66,988 | 65,149 | | Non-controlling interests | 24,080 | 23,686 | | **TOTAL EQUITY** | **91,068** | **88,835** | | **LIABILITIES** | | | | Total current liabilities | 29,800 | 35,676 | | Total non-current liabilities | 19,957 | 18,879 | | **TOTAL LIABILITIES** | **49,757** | **54,555** | | **TOTAL EQUITY AND LIABILITIES** | **140,825** | **143,390** | | Net current assets | 26,649 | 21,561 | | Total assets less current liabilities | 111,025 | 107,714 | [Notes to the Unaudited Consolidated Interim Financial Information](index=6&type=section&id=III.%20%E6%9C%AA%E7%B6%93%E5%AF%A9%E6%A0%B8%E7%B6%9C%E5%90%88%E4%B8%AD%E6%9C%9F%E8%B2%A1%E5%8B%99%E8%B3%87%E6%96%99%E9%99%84%E8%A8%BB) This section provides detailed notes to the unaudited consolidated interim financial information [Basis of Preparation and Accounting Policies](index=6&type=section&id=3.1%20%E7%B7%A8%E8%A3%BD%E5%9F%BA%E6%BA%96%E5%8F%8A%E6%9C%83%E8%A8%88%E6%94%BF%E7%AD%96) This chapter explains the basis of preparation for the interim financial information, adhering to HKAS 34 and HKEX Listing Rules, noting that new and revised standards adopted this period, such as HKAS 21 amendments, had no significant impact on the Group's accounting policies - The Group's unaudited interim financial report is prepared in accordance with Hong Kong Accounting Standard 34 'Interim Financial Reporting' issued by the Hong Kong Institute of Certified Public Accountants and the applicable disclosure requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[9](index=9&type=chunk) - The Group first applied 'The Effects of Changes in Foreign Exchange Rates – Lack of Exchangeability – Amendments to HKAS 21' from **January 1, 2025**, but this amendment had no significant impact on the Group's accounting policies and required no retrospective adjustments[10](index=10&type=chunk)[11](index=11&type=chunk) [Segment Information](index=6&type=section&id=3.2%20%E6%9D%BF%E5%A1%8A%E8%B3%87%E6%96%99) This chapter details the Group's four operating segments by product and service: natural gas sales, LPG sales, LNG processing and storage, and exploration and production, providing revenue, results, and asset data for each segment to assess performance - The Group's business is divided into four operating segments: natural gas sales, LPG sales, LNG processing and storage, and exploration and production[13](index=13&type=chunk) Segment Revenue and Results for the Six Months Ended June 30, 2025 | Segment | Revenue from External Customers (RMB million) | Segment Results (RMB million) | Profit/(Loss) Before Income Tax Expense (RMB million) | | :--- | :--- | :--- | :--- | | Natural Gas Sales | 80,078 | 3,974 | 4,477 | | LPG Sales | 13,020 | 538 | 544 | | LNG Processing and Storage | 4,371 | 1,835 | 1,836 | | Exploration and Production | 74 | 18 | 61 | | Corporate Headquarters | – | (192) | (181) | | Total | 97,543 | 6,173 | 6,737 | Segment Revenue and Results for the Six Months Ended June 30, 2024 | Segment | Revenue from External Customers (RMB million) | Segment Results (RMB million) | Profit/(Loss) Before Income Tax Expense (RMB million) | | :--- | :--- | :--- | :--- | | Natural Gas Sales | 75,506 | 4,545 | 5,005 | | LPG Sales | 12,887 | 563 | 561 | | LNG Processing and Storage | 4,441 | 1,640 | 1,648 | | Exploration and Production | 88 | 14 | 174 | | Corporate Headquarters | – | (150) | (139) | | Total | 92,922 | 6,612 | 7,249 | [Revenue](index=9&type=section&id=3.3%20%E6%94%B6%E5%85%A5) This chapter clarifies that the Group's revenue primarily stems from natural gas sales, LPG sales, LNG processing and storage, and crude oil sales - Revenue primarily refers to income from natural gas sales, LPG sales, LNG processing and storage, and crude oil sales[19](index=19&type=chunk) [Interest Expense](index=9&type=section&id=3.4%20%E5%88%A9%E6%81%AF%E6%94%AF%E5%87%BA) This chapter discloses the composition of interest expense, including capitalized amounts, and notes a decrease in the average annual interest rate for capitalized borrowing costs during the period Interest Expense (For the Six Months Ended June 30) | Indicator | 2025 (RMB million) | 2024 (RMB million) | | :--- | :--- | :--- | | Interest expense | 339 | 426 | | Less: Capitalized amount | (16) | (15) | | Total interest expense | 323 | 411 | - The average annual interest rate used for capitalized borrowing costs during the period was **3.13%** (2024: 3.40%), showing a decrease[20](index=20&type=chunk) [Profit Before Income Tax Expense](index=9&type=section&id=3.5%20%E9%99%A4%E6%89%80%E5%BE%97%E7%A8%85%E8%B2%BB%E7%94%A8%E5%89%8D%E6%BA%A2%E5%88%A9) This chapter lists the expenses deducted from profit before income tax expense, including amortization of intangible assets, depreciation of property, plant and equipment, depreciation of right-of-use assets, cost of inventories, and impairment (reversal)/loss on trade receivables Items Deducted from Profit Before Income Tax Expense (For the Six Months Ended June 30) | Item | 2025 (RMB million) | 2024 (RMB million) | | :--- | :--- | :--- | | Amortization of intangible assets | 40 | 42 | | Depreciation and depletion of: | | | | – Owned property, plant and equipment | 2,495 | 2,447 | | – Right-of-use assets | 265 | 265 | | Cost of inventories recognized as expense | 84,816 | 79,793 | | Impairment (reversal)/loss on trade receivables | (29) | 51 | [Income Tax Expense](index=10&type=section&id=3.6%20%E6%89%80%E5%BE%97%E7%A8%85%E8%B2%BB%E7%94%A8) This chapter explains the calculation of income tax expense, including the corporate income tax rate for PRC subsidiaries (primarily 25%, with 15%-20% preferential rates in some regions) and overseas profit tax rates, noting no Hong Kong profits tax provision for the period Income Tax Expense (For the Six Months Ended June 30) | Item | 2025 (RMB million) | 2024 (RMB million) | | :--- | :--- | :--- | | Current tax: China | 1,728 | 1,847 | | Current tax: Overseas | 11 | 19 | | Deferred tax | (4) | 63 | | Total | 1,735 | 1,929 | - The PRC corporate income tax rate for the Group's subsidiaries in mainland China is primarily **25%**, with certain regions enjoying preferential tax rates ranging from **15% to 20%** for eligible operations[22](index=22&type=chunk) - No provision for Hong Kong profits tax was made for the period as the Group had no assessable profits subject to Hong Kong profits tax[23](index=23&type=chunk) [Basic and Diluted Earnings Per Share](index=10&type=section&id=3.7%20%E6%AF%8F%E8%82%A1%E5%9F%BA%E6%9C%AC%E5%8F%8A%E6%94%A4%E8%96%84%E7%9B%88%E5%88%A9) This chapter calculates basic earnings per share and states that diluted earnings per share are the same as basic earnings per share for the current period and the corresponding period in 2024, as there are no potential dilutive ordinary shares Basic Earnings Per Share (For the Six Months Ended June 30) | Indicator | 2025 (RMB cents) | 2024 (RMB cents) | | :--- | :--- | :--- | | Basic earnings per share | 36.51 | 38.17 | - Basic earnings per share is calculated based on profit attributable to equity holders of the Company of approximately **RMB 3,161 million** (2024: RMB 3,305 million) and the weighted average number of ordinary shares outstanding of approximately **8,659 million shares**[26](index=26&type=chunk) - Diluted earnings per share for the current period and the corresponding period in 2024 are the same as basic earnings per share, as there are no potential dilutive ordinary shares[26](index=26&type=chunk) [Dividends](index=11&type=section&id=3.8%20%E8%82%A1%E6%81%AF) This chapter lists the 2023 final dividend, 2024 final dividend, and the 2025 interim dividend declared by the Board, including per-share amounts, total amounts, and payment dates, noting shareholders' option to receive dividends in RMB or HKD Dividend Declaration Details | Dividend Type | Amount Per Share (RMB cents) | Total Amount (RMB million) | Approval Date | Payment Date | | :--- | :--- | :--- | :--- | :--- | | 2023 Final Dividend | 28.38 | 2,457 | 2024年5月30日 | 2024年7月18日 | | 2024 Final Dividend | 15.17 | 1,314 | 2025年5月29日 | 2025年7月18日 | | 2025 Interim Dividend | 16.60 | 1,437 | 2025年8月19日 | Expected October 23, 2025 | - Shareholders have the option to receive dividends in **RMB or HKD**[27](index=27&type=chunk) [Trade Receivables](index=11&type=section&id=3.9%20%E6%87%89%E6%94%B6%E8%B3%87%E6%AC%BE) This chapter provides an aging analysis of trade receivables (net of loss allowance) as of June 30, 2025, and December 31, 2024, and explains the collection periods for different businesses Aging Analysis of Trade Receivables (RMB million) | Aging | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Within 3 months | 1,834 | 1,713 | | 3 to 6 months | 705 | 58 | | 6 to 12 months | 333 | 252 | | Over 12 months | 532 | 521 | | **Total** | **3,404** | **2,544** | - Revenue from receiving station services and crude oil sales is generally collected within **30 to 90 days** from the invoice date, while natural gas sales have a credit period not exceeding **90 days**[28](index=28&type=chunk) [Trade and Other Payables and Accrued Liabilities](index=12&type=section&id=3.10%20%E6%87%89%E4%BB%98%E8%B3%87%E6%AC%BE%E5%8F%8A%E6%87%89%E8%A8%88%E8%B2%A0%E5%82%B5) This chapter details the composition of trade and other payables and accrued liabilities as of June 30, 2025, and December 31, 2024, and provides an aging analysis of trade payables Trade and Other Payables and Accrued Liabilities (RMB million) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Trade payables | 3,197 | 3,106 | | Contract liabilities | 10,671 | 12,690 | | Salaries and welfare payable | 852 | 326 | | Accrued expenses | 230 | 22 | | Dividends payable | 1,505 | 158 | | Interest payable | 154 | 137 | | Construction and equipment costs payable | 4,611 | 5,541 | | Amounts due to related parties | 2 | 2 | | Other payables | 3,136 | 3,242 | | **Total** | **24,358** | **25,224** | Aging Analysis of Trade Payables (RMB million) | Aging | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Within 3 months | 2,575 | 2,576 | | 3 to 6 months | 251 | 116 | | Over 6 months | 371 | 414 | | **Total** | **3,197** | **3,106** | [Chairman's Report](index=13&type=section&id=IV.%20%E4%B8%BB%E5%B8%AD%E5%A0%B1%E5%91%8A) This section presents the Chairman's report on the Group's performance and outlook [Performance Overview](index=13&type=section&id=4.1%20%E6%A5%AD%E7%B8%BE%E6%A6%82%E8%A7%88) The Chairman's report begins with an overview of the Group's H1 2025 performance, showing growth in natural gas sales and revenue, but a decline in profit before income tax and net profit attributable to equity holders due to various factors H1 2025 Key Performance Overview (Year-on-Year) | Indicator | H1 2025 | Change % | | :--- | :--- | :--- | | Natural Gas Sales Volume | 29.095 billion cubic meters | +

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，概不就因本公告 全部或任何部分內容而產生或因依賴該等內容而引致的任何損失承擔任何責任。 InnoCare Pharma Limited 諾誠健華醫藥有限公司 （ 於 開 曼 群 島 註 冊 成 立 的 有 限 公 司 ） （股份代號：9969） 截至2025年6月30日止六個月中期業績公告 諾誠健華醫藥有限公司（「本公司」，連同其附屬公司統稱「本集團」）董事（「董 事」）會（「董事會」）欣然公佈，本集團截至2025年6月30日止六個月（「報告期」） 之未經審核綜合業績連同截至2024年6月30日止六個月之比較數字。 在本公告內，「我們」及「我們的」均指本公司，如文義另有所指，則指本集團。 本公告所載若干金額及百分比數字已約整或已四捨五入至小數點後一位或兩 位數（如適用）。任何表格、圖表或其他地方所示總額與所列數額總和如有任何 差異乃因四捨五入所致。除另有界定外，本公告所使用詞彙與招股章程已界定 者具有相同涵義。 – 1 – | 財務摘要 | | | | --- | --- | --- | ...

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，並明確表明概不會就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。 SUNNY OPTICAL TECHNOLOGY (GROUP) COMPANY LIMITED 舜 宇 光 學 科 技（ 集 團 ）有 限 公 司 （於開曼群島註冊成立的有限公司） （股份代號：2382.HK） 截至二零二五年六月三十日止六個月 中期業績公告 業績摘要 截至二零二五年六月三十日止六個月，本集團未經審核的收入約人民幣（「人民 幣」）19,651,900,000元，較去年同期增加約4.2%。 截至二零二五年六月三十日止六個月，本集團的毛利約人民幣3,894,400,000 元，較去年同期增加約20.0%。毛利率則約19.8%，較去年同期增加約2.6個百分 點。 截至二零二五年六月三十日止六個月，本集團的本公司股東應佔期內溢利約人 民幣1,646,100,000元，較去年同期增加約52.6%。 財務業績 舜宇光學科技（集團）有限公司（「本公司」）董事（「董事」，各為一名「董事」）會 （「董事會 ...

[Overview of Announcement](index=1&type=section&id=Overview%20of%20Announcement) [Purpose and Scope](index=1&type=section&id=Purpose%20and%20Scope) This announcement supplements Century United Holdings Limited's 2024 annual report, providing additional information on continuing connected transactions, specifically the property lease framework agreement - This announcement is a supplementary announcement to the 2024 annual report of Century United Holdings Limited (Stock Code: 1959)[2](index=2&type=chunk) - The main supplementary content concerns continuing connected transactions, particularly the property lease framework agreement[2](index=2&type=chunk)[3](index=3&type=chunk) [Continuing Connected Transactions](index=1&type=section&id=Continuing%20Connected%20Transactions) [Property Lease Framework Agreement](index=1&type=section&id=Property%20Lease%20Framework%20Agreement) Century United Holdings Limited entered into a property lease framework agreement with Zhongshan Genesis Automobile Co., Ltd. and its subsidiaries to meet the Group's operational needs, setting annual caps for rent and right-of-use assets [Key Terms of Agreement](index=1&type=section&id=Key%20Terms%20of%20Agreement) The agreement was signed on December 31, 2021, valid until December 31, 2024, with the Company as lessee and Zhongshan Genesis Automobile Co., Ltd. as lessor - The agreement date is **December 31, 2021**[3](index=3&type=chunk) - The contracting parties are the Company (lessee) and Zhongshan Genesis Automobile Co., Ltd. (lessor)[3](index=3&type=chunk) - The agreement period is from **January 1, 2022, to December 31, 2024**[4](index=4&type=chunk) [Purpose and Scope of Lease](index=2&type=section&id=Purpose%20and%20Scope%20of%20Lease) Leased properties include land and buildings for shops, offices, warehouses, and parking spaces to meet the Group's operational requirements - The purpose of the lease is to meet the Group's operational needs, including land and buildings for shops, offices, warehouses, and parking spaces[5](index=5&type=chunk) - Members of the Group will enter into separate agreements with the Excluded Group for the leased properties, with terms consistent with the framework agreement[5](index=5&type=chunk) [Rent Determination Mechanism](index=2&type=section&id=Rent%20Determination%20Mechanism) Rent is determined on normal commercial terms no less favorable than market rates, through fair negotiation, considering development, construction, upgrade, decoration costs, depreciation, and market conditions of the property location and similar leases - Rent is determined on normal commercial terms no less favorable than market rates, through fair negotiation[7](index=7&type=chunk) - Factors for rent determination include land development and integration costs, construction costs, utility upgrade costs, decoration costs, and property depreciation costs[7](index=7&type=chunk) - Rent determination also considers current market conditions of the property location and current rental levels of similar leases nearby[7](index=7&type=chunk) [Annual Caps and Accounting Treatment](index=3&type=section&id=Annual%20Caps%20and%20Accounting%20Treatment) The agreement sets an annual rent cap of RMB 4,686,000 for 2022-2024; under IFRS 16, long-term leases recognize right-of-use assets and lease liabilities, with an annual cap for right-of-use assets Annual Caps for Property Lease Framework Agreement | Metric | 2022 (RMB '000) | 2023 (RMB '000) | 2024 (RMB '000) | | :--- | :--- | :--- | :--- | | Estimated Annual Rent Payable | 4,686 | 4,686 | 4,686 | | Annual Cap for Right-of-Use Assets | 13,011 | — | — | - According to IFRS 16 Leases, long-term leases (over 12 months) require recognition of right-of-use assets and lease liabilities[8](index=8&type=chunk) [Actual Execution in FY2024](index=3&type=section&id=Actual%20Execution%20in%20FY2024) For the year ended December 31, 2024, the Group's actual total rent paid and right-of-use assets recognized were both RMB 0, neither exceeding the annual caps Actual Execution of Property Lease Framework Agreement in FY2024 | Metric | 2024 (RMB) | Exceeded Annual Cap | | :--- | :--- | :--- | | Actual Total Rent Paid | 0 | No | | Right-of-Use Assets Recognized | 0 | No | [Other Information](index=4&type=section&id=Other%20Information) [Board Statement](index=4&type=section&id=Board%20Statement) Information disclosed in this supplementary announcement does not affect other content in the 2024 annual report and lists the board members as of the announcement date - The information in this supplementary announcement does not affect other information contained in the 2024 annual report, and the remaining content remains unchanged[10](index=10&type=chunk) - The announcement lists the Chairman, Executive Director and CEO Luo Houjie, as well as other Executive Directors and Independent Non-Executive Directors[11](index=11&type=chunk)

[Performance Summary](index=1&type=section&id=%E8%A1%A8%E7%8F%BE%E6%91%98%E8%A6%81) [Interim Results Overview](index=1&type=section&id=%E4%B8%AD%E6%9C%9F%E6%A5%AD%E7%B8%BE) Sinomax Group Limited announced its unaudited interim results for the six months ended June 30, 2025, with revenue, gross profit, and profit for the period all significantly decreasing compared to the same period last year, reflecting a challenging operating environment | Indicator | Six months ended June 30, 2025 (Thousand HKD) | Six months ended June 30, 2024 (Thousand HKD) | Change (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenue | 1,892,127 | 2,002,775 | (110,648) | -5.5% | | Gross Profit | 442,443 | 507,290 | (64,847) | -12.8% | | Profit for the period | 30,415 | 74,205 | (43,790) | -59.0% | [Condensed Consolidated Financial Statements](index=2&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8) [Condensed Consolidated Statement of Profit or Loss](index=2&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%90%8D%E7%9B%8A%E8%A1%A8) For the six months ended June 30, 2025, the Group's revenue decreased by 5.5% to HKD 1,892.1 Million, and gross profit decreased by 12.8% to HKD 442.4 Million; operating profit significantly decreased by 54.0% to HKD 53.3 Million, with profit for the period sharply declining by 59.0% to HKD 30.4 Million, and basic earnings per share falling to 1.54 HK cents | Indicator | 2025 (Thousand HKD) | 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 1,892,127 | 2,002,775 | -5.5% | | Cost of sales | (1,449,684) | (1,495,485) | -3.1% | | Gross Profit | 442,443 | 507,290 | -12.8% | | Selling and distribution expenses | (235,071) | (252,982) | -7.1% | | Administrative expenses | (119,227) | (124,161) | -4.0% | | Research and development costs | (39,175) | (40,910) | -4.2% | | Operating profit | 53,287 | 115,842 | -54.0% | | Finance costs | (24,749) | (23,096) | +7.1% | | Profit before income tax | 35,829 | 92,746 | -61.4% | | Income tax expense | (5,414) | (18,541) | -70.8% | | Profit for the period | 30,415 | 74,205 | -59.0% | | Profit for the period attributable to owners of the Company | 26,911 | 62,096 | -56.7% | | Basic earnings per share (HK cents) | 1.54 | 3.55 | -56.6% | [Condensed Consolidated Statement of Comprehensive Income](index=3&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) For the six months ended June 30, 2025, the Group's total comprehensive income for the period was HKD 44.7 Million, a 17.5% decrease from HKD 54.2 Million in the prior year, positively impacted by exchange differences from overseas operations turning from loss to gain, partially offsetting the decline in profit for the period | Indicator | 2025 (Thousand HKD) | 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Profit for the period | 30,415 | 74,205 | -59.0% | | Exchange differences arising on translation of overseas operations | 14,289 | (19,976) | N/A (from loss to gain) | | Total comprehensive income for the period | 44,704 | 54,229 | -17.5% | | Total comprehensive income for the period attributable to owners of the Company | 22,569 | 43,269 | -47.9% | [Condensed Consolidated Statement of Financial Position](index=4&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) As of June 30, 2025, the Group's total assets increased by 6.7% to HKD 2,727.5 Million compared to December 31, 2024, with significant increases in current assets, particularly inventories, trade and other receivables, and cash and cash equivalents; total liabilities also rose, mainly due to increased unsecured bank borrowings | Indicator | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | **ASSETS** | | | | | Total non-current assets | 880,717 | 891,892 | -1.3% | | Total current assets | 1,846,790 | 1,665,094 | +10.9% | | Inventories | 509,082 | 476,548 | +6.8% | | Trade and other receivables | 830,982 | 777,273 | +6.9% | | Cash and cash equivalents | 348,320 | 262,436 | +32.7% | | **TOTAL ASSETS** | **2,727,507** | **2,556,986** | **+6.7%** | | **EQUITY** | | | | | Equity attributable to owners of the Company | 973,524 | 973,705 | -0.02% | | Total equity | 1,004,483 | 999,756 | +0.47% | | **LIABILITIES** | | | | | Total non-current liabilities | 229,331 | 262,334 | -12.6% | | Total current liabilities | 1,493,693 | 1,294,896 | +15.4% | | Unsecured bank borrowings | 581,098 | 401,102 | +44.9% | | **TOTAL LIABILITIES** | **1,723,024** | **1,557,230** | **+10.6%** | | **TOTAL EQUITY AND LIABILITIES** | **2,727,507** | **2,556,986** | **+6.7%** | [Notes to the Condensed Consolidated Interim Financial Information](index=6&type=section&id=%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E4%B8%AD%E6%9C%9F%E8%B2%A1%E5%8B%99%E8%B3%87%E6%96%99%E9%99%84%E8%A8%BB) [1. Basis of Preparation](index=6&type=section&id=1.%20%E7%B7%A8%E8%A3%BD%E5%9F%BA%E6%BA%96) The Group's condensed consolidated interim financial information is prepared in accordance with HKAS 34 'Interim Financial Reporting' and should be read in conjunction with the annual consolidated financial statements for the year ended December 31, 2024 - Financial information prepared in accordance with **HKAS 34**, an interim report, should be read in conjunction with the annual financial statements[8](index=8&type=chunk) [2. Accounting Policies](index=6&type=section&id=2.%20%E6%9C%83%E8%A8%88%E6%94%BF%E7%AD%96) The Group's accounting policies are consistent with the previous financial year, with initial application of certain amendments to standards issued by the HKICPA, including HKAS 21 and HKFRS 1 (Revised) 'Lack of Exchangeability', which are not expected to have a significant impact on the financial statements; several unadopted new standards and amendments have also been disclosed, with HKFRS 18 'Presentation and Disclosure in Financial Statements' expected to be mandatorily effective from January 1, 2027, and will have a widespread impact on presentation and disclosure - The Group first applied **HKAS 21** and **HKFRS 1 (Revised) 'Lack of Exchangeability'** in this period, with no significant impact expected[11](index=11&type=chunk) - **HKFRS 18 'Presentation and Disclosure in Financial Statements'** will be mandatory effective from January 1, 2027, and is expected to have a widespread impact on presentation and disclosure, with management currently assessing the specific effects[12](index=12&type=chunk)[13](index=13&type=chunk) [3. Revenue and Segment Information](index=8&type=section&id=3.%20%E6%94%B6%E5%85%A5%E5%8F%8A%E5%88%86%E9%83%A8%E8%B3%87%E6%96%99) The Group primarily derives revenue from sales of health and home products and polyurethane foam, with total revenue decreasing by 5.5% year-on-year to HKD 1,892.1 Million during the reporting period; sales of health and home products slightly decreased, while polyurethane foam sales significantly reduced, and by geographical market, sales in Mainland China and North America both declined, while Europe and other overseas markets achieved 25.2% growth Disaggregation of Revenue from Contracts with Customers (by Product Category) | Product Category | 2025 (Thousand HKD) | 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Sales of health and home products | 1,324,940 | 1,341,486 | -1.2% | | Sales of polyurethane foam | 567,187 | 661,289 | -14.2% | | **Total** | **1,892,127** | **2,002,775** | **-5.5%** | Disaggregation of Revenue from Contracts with Customers (by Geographical Market) | Geographical Market | 2025 (Thousand HKD) | 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Mainland China market | 792,541 | 863,566 | -8.2% | | North American market | 692,022 | 813,581 | -14.9% | | European and other overseas markets | 407,564 | 325,628 | +25.2% | | **Total** | **1,892,127** | **2,002,775** | **-5.5%** | [4. Other Income](index=10&type=section&id=4.%20%E5%85%B6%E4%BB%96%E6%94%B6%E5%85%A5) During the reporting period, the Group's total other income significantly decreased by 47.8% to HKD 16.8 Million from HKD 32.2 Million in the prior year, mainly due to a substantial decline in the 'Others' category | Item | 2025 (Thousand HKD) | 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Interest income | 2,240 | 3,388 | -33.9% | | Government grants | 690 | 911 | -24.3% | | Rental income | 5,257 | 5,635 | -6.7% | | Others | 8,655 | 22,305 | -61.2% | | **Total** | **16,842** | **32,239** | **-47.8%** | [5. Finance Costs](index=10&type=section&id=5.%20%E8%B2%A1%E5%8B%99%E6%88%90%E6%9C%AC) For the six months ended June 30, 2025, the Group's total finance costs increased by 7.1% to HKD 24.7 Million compared to the prior year, primarily due to higher interest on bank borrowings and lease liabilities | Item | 2025 (Thousand HKD) | 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Interest on bank borrowings | 13,759 | 12,585 | +9.3% | | Interest on lease liabilities | 9,513 | 7,720 | +23.2% | | Interest and fees on factoring of trade receivables | 1,477 | 2,791 | -47.1% | | **Total** | **24,749** | **23,096** | **+7.1%** | [6. Income Tax Expense](index=11&type=section&id=6.%20%E6%89%80%E5%BE%97%E7%A8%85%E9%96%8B%E6%94%AF) Income tax expense for the reporting period significantly decreased by 70.8% to HKD 5.4 Million, mainly due to a reduction in the estimated average annual tax rate from 20% to 15%, attributed to the underperformance of certain subsidiaries in Mainland China subject to higher statutory tax rates | Item | 2025 (Thousand HKD) | 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Current tax | 10,450 | 19,822 | -47.3% | | Deferred tax | (5,036) | (1,281) | +293.1% | | **Total** | **5,414** | **18,541** | **-70.8%** | - The estimated average annual tax rate for 2025 is **15%**, a decrease from **20%** in 2024, primarily due to underperformance of certain subsidiaries in Mainland China[20](index=20&type=chunk) [7. Profit for the Period](index=11&type=section&id=7.%20%E6%9C%9F%E5%85%A7%E6%BA%A2%E5%88%A9) Profit for the period was HKD 30.4 Million, a significant decrease from the prior year, with key cost items showing reductions in cost of inventories recognized as an expense, marketing and promotion expenses, and transportation expenses, while total staff costs, depreciation of property, plant and equipment, and depreciation of right-of-use assets increased | Item | 2025 (Thousand HKD) | 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Cost of inventories recognised as an expense | 1,104,100 | 1,161,730 | -5.0% | | Total staff costs | 312,243 | 302,983 | +3.1% | | Depreciation of property, plant and equipment | 43,138 | 35,751 | +20.7% | | Depreciation of right-of-use assets | 45,571 | 39,261 | +16.1% | | Marketing and promotion expenses | 62,210 | 82,443 | -24.6% | | Transportation expenses | 52,162 | 55,328 | -5.7% | [8. Earnings Per Share](index=12&type=section&id=8.%20%E6%AF%8F%E8%82%A1%E7%9B%88%E5%88%A9) For the six months ended June 30, 2025, both basic and diluted earnings per share attributable to owners of the Company were 1.54 HK cents, a significant decrease of 56.6% from 3.55 HK cents in the prior year; diluted earnings per share were equal to basic earnings per share because the exercise price of unexercised share options was higher than the average share price for the period | Indicator | 2025 (HK cents) | 2024 (HK cents) | Change (%) | | :--- | :--- | :--- | :--- | | Basic earnings per share | 1.54 | 3.55 | -56.6% | | Diluted earnings per share | 1.54 | 3.55 | -56.6% | - Diluted earnings per share are equal to basic earnings per share, as the exercise price of unexercised share options is higher than the average share price for the period, resulting in no dilutive effect[22](index=22&type=chunk) [9. Dividends](index=12&type=section&id=9.%20%E8%82%A1%E6%81%AF) The Board resolved to declare an interim dividend of 0.5 HK cents per share for the six months ended June 30, 2025, totaling approximately HKD 8.75 Million, a decrease from 1.0 HK cents per share in the prior year | Item | 2025 (HK cents/share) | 2024 (HK cents/share) | Change (%) | | :--- | :--- | :--- | :--- | | Interim dividend | 0.5 | 1.0 | -50.0% | | Total dividend amount (Thousand HKD) | 8,750 | N/A | N/A | [10. Trade Receivables, Deposits, Prepayments and Other Receivables](index=13&type=section&id=10.%20%E8%B2%BF%E6%98%93%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85%E3%80%81%E6%8C%89%E9%87%91%E3%80%81%E9%A0%90%E4%BB%98%E6%AC%BE%E9%A0%85%E5%8F%8A%E5%85%B6%E4%BB%96%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85) As of June 30, 2025, net trade receivables increased by 11.4% to HKD 697.3 Million compared to December 31, 2024, with an increase in provision for credit losses; the ageing analysis of trade receivables shows that within 30 days and 31 to 60 days categories account for the largest proportions, and receivables aged 91 to 180 days significantly increased | Item | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Trade receivables, net | 697,318 | 626,007 | +11.4% | | Provision for credit losses | (25,458) | (23,362) | +9.0% | | Current portion | 830,982 | 777,273 | +6.9% | Ageing Analysis of Trade Receivables (Net) | Ageing | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Within 30 days | 327,188 | 299,538 | +9.2% | | 31 to 60 days | 202,000 | 182,853 | +10.5% | | 61 to 90 days | 94,610 | 96,867 | -2.3% | | 91 to 180 days | 67,949 | 32,678 | +108.0% | | 181 to 365 days | 532 | 14,071 | -96.2% | | Over 365 days | 5,039 | - | N/A | | **Total** | **697,318** | **626,007** | **+11.4%** | [11. Bills Receivable](index=14&type=section&id=11.%20%E6%87%89%E6%94%B6%E7%A5%A8%E6%93%9A) As of June 30, 2025, total bills receivable were HKD 112.6 Million, largely consistent with December 31, 2024; bills receivable aged 91 to 180 days increased, while those aged 181 to 365 days significantly decreased, and approximately HKD 92.2 Million of bills receivable were endorsed to settle trade payables Ageing Analysis of Bills Receivable | Ageing | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Within 30 days | 27,643 | 23,374 | +18.3% | | 31 to 60 days | 18,369 | 18,956 | -3.1% | | 61 to 90 days | 16,188 | 23,810 | -32.0% | | 91 to 180 days | 50,267 | 43,704 | +15.0% | | 181 to 365 days | 92 | 2,521 | -96.3% | | **Total** | **112,559** | **112,365** | **+0.2%** | - Approximately **HKD 92.2 Million** (December 31, 2024: HKD 95.0 Million) of bills receivable were endorsed to settle trade payables[27](index=27&type=chunk) [12. Trade and Other Payables](index=15&type=section&id=12.%20%E8%B2%BF%E6%98%93%E5%8F%8A%E5%85%B6%E4%BB%96%E6%87%89%E4%BB%98%E6%AC%BE%E9%A0%85) As of June 30, 2025, total trade and other payables increased by 2.5% to HKD 762.2 Million compared to December 31, 2024; accrued operating expenses and dividends payable significantly increased, while trade payables and accrued salaries decreased, and the ageing analysis of trade payables shows that the within 30 days category, while still the largest, decreased | Item | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Trade payables | 470,404 | 487,035 | -3.4% | | Accrued operating expenses | 130,633 | 90,303 | +44.7% | | Accrued salaries | 65,002 | 89,572 | -27.4% | | Dividends payable | 26,733 | - | N/A | | **Total trade and other payables** | **762,196** | **743,860** | **+2.5%** | | Current portion | 761,881 | 743,366 | +2.5% | Ageing Analysis of Trade Payables | Ageing | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Within 30 days | 275,696 | 302,254 | -8.7% | | 31 to 60 days | 113,793 | 96,598 | +17.8% | | 61 to 90 days | 28,139 | 38,806 | -27.5% | | 91 to 180 days | 45,627 | 39,894 | +14.4% | | Over 180 days | 7,149 | 9,483 | -24.6% | | **Total** | **470,404** | **487,035** | **-3.4%** | [13. Bills Payable](index=16&type=section&id=13.%20%E6%87%89%E4%BB%98%E7%A5%A8%E6%93%9A) As of June 30, 2025, total bills payable increased by 35.0% to HKD 40.1 Million compared to December 31, 2024, with significant increases in bills payable aged within 30 days and 91 to 180 days Ageing Analysis of Bills Payable | Ageing | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Within 30 days | 13,161 | 3,305 | +298.3% | | 31 to 60 days | - | 2,151 | -100.0% | | 61 to 90 days | 2,615 | - | N/A | | 91 to 180 days | 24,307 | 24,234 | +0.3% | | **Total** | **40,083** | **29,690** | **+35.0%** | [14. Unsecured Bank Borrowings](index=17&type=section&id=14.%20%E7%84%A1%E6%8A%B5%E6%8A%BC%E9%8A%80%E8%A1%8C%E5%80%9F%E6%AC%BE) As of June 30, 2025, total unsecured bank borrowings significantly increased by 44.9% to HKD 581.1 Million compared to December 31, 2024; the effective interest rate range for borrowings narrowed to 1.90% to 6.20% per annum from 2.80% to 6.43% per annum as of December 31, 2024 | Item | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Trade finance | 396,645 | 278,182 | +42.6% | | Revolving loans | 169,900 | 117,200 | +44.9% | | Term loans | 14,553 | 5,720 | +154.4% | | **Total** | **581,098** | **401,102** | **+44.9%** | - The effective interest rate range for bank borrowings is **1.90% to 6.20%** per annum (December 31, 2024: 2.80% to 6.43%)[32](index=32&type=chunk) - All bank borrowings bear interest at floating rates and are repayable within one year or on demand[32](index=32&type=chunk)[33](index=33&type=chunk) [15. Capital Commitments](index=17&type=section&id=15.%20%E8%B3%87%E6%9C%AC%E6%89%BF%E6%93%94) As of June 30, 2025, capital expenditure contracted but not provided for by the Group for the acquisition of property, plant and equipment was HKD 7.8 Million, a significant decrease of 60.3% from December 31, 2024 | Item | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Capital expenditure contracted but not provided for | 7,796 | 19,610 | -60.3% | [16. Events After the Reporting Period](index=17&type=section&id=16.%20%E5%A0%B1%E5%91%8A%E6%9C%9F%E5%BE%8C%E4%BA%8B%E9%A0%85) Subsequent to the reporting period, on August 4, 2025, the Group further subscribed for additional shares in associate MDK Holdings ApS for EUR 5 Million (approximately HKD 45.9 Million), increasing its equity interest to 55%, making it a subsidiary of the Group; this acquisition will be consolidated into the Group's accounts from August 4, 2025 - On **August 4, 2025**, the Group increased its stake in European entity MDK Holdings ApS to **55%** for **EUR 5 Million** (approximately **HKD 45.9 Million**), making it a subsidiary[35](index=35&type=chunk) - The operating results and assets and liabilities of the acquired company will be consolidated into the Group's accounts from **August 4, 2025**[35](index=35&type=chunk) [Business Review](index=18&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7) [Revenue by Operating Segment](index=18&type=section&id=%E6%8C%89%E7%B6%93%E7%87%9F%E5%88%86%E9%83%A8%E5%8A%83%E5%88%86%E7%9A%84%E6%94%B6%E5%85%A5) During the reporting period, total revenue decreased by 5.5% to HKD 1,892.1 Million; sales in Mainland China and North America markets decreased by 8.2% and 14.9% respectively, mainly due to weak economy, low consumer sentiment, intense price competition, and US tariff policies, while Europe and other overseas markets achieved 25.2% growth, primarily benefiting from increased sales to European customers | Geographical Market | 2025 (Thousand HKD) | 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Mainland China market | 792,541 | 863,566 | -8.2% | | North American market | 692,022 | 813,581 | -14.9% | | European and other overseas markets | 407,564 | 325,628 | +25.2% | | **Total** | **1,892,127** | **2,002,775** | **-5.5%** | - The decrease in Mainland China market sales is primarily due to the weak Chinese economy, low consumer sentiment, and intense price competition[37](index=37&type=chunk) - The decrease in North American market sales is primarily due to global trade volatility under US tariff policies, leading to increased supply chain uncertainty[37](index=37&type=chunk) [Gross Profit](index=19&type=section&id=%E6%AF%9B%E5%88%A9) During the reporting period, gross profit decreased by 12.8% to HKD 442.4 Million, primarily due to increased indirect costs from the Group's expanded business operations in Vietnam and the US, including new factory lease agreements | Indicator | 2025 (Thousand HKD) | 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Gross Profit | 442,443 | 507,290 | -12.8% | - The decrease in gross profit is mainly due to increased indirect costs from expanding business operations in Vietnam and the US, including new factory lease agreements[38](index=38&type=chunk) [Costs and Expenses](index=19&type=section&id=%E6%88%90%E6%9C%AC%E5%8F%8A%E9%96%8B%E6%94%AF) During the reporting period, selling and distribution expenses decreased by 7.1% to HKD 235.1 Million, mainly due to reduced marketing and advertising expenses; administrative expenses decreased by 4.0% to HKD 119.2 Million, primarily due to reduced staff costs | Item | 2025 (Thousand HKD) | 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Selling and distribution expenses | 235,071 | 252,982 | -7.1% | | Administrative expenses | 119,227 | 124,161 | -4.0% | - Selling and distribution expenses decreased primarily due to a reduction of approximately **HKD 20.2 Million** in marketing and advertising expenses[39](index=39&type=chunk) - Administrative expenses decreased primarily due to a reduction of approximately **HKD 2.8 Million** in staff costs[39](index=39&type=chunk) [Profit for the Period](index=19&type=section&id=%E5%A0%B1%E5%91%8A%E6%9C%9F%E5%85%A7%E6%BA%A2%E5%88%A9) Cumulatively, profit for the period significantly decreased by 59.0% to HKD 30.4 Million | Indicator | 2025 (Thousand HKD) | 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Profit for the period | 30,415 | 74,205 | -59.0% | [Liquidity, Financial and Capital Resources](index=20&type=section&id=%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E3%80%81%E8%B2%A1%E5%8B%99%E5%8F%8A%E8%B3%87%E6%9C%AC%E8%B3%87%E6%BA%90) As of June 30, 2025, the Group's net current assets were HKD 353.1 Million, a slight decrease from December 31, 2024; bank balances and cash significantly increased by 32.7% to HKD 348.3 Million, but net cash generated from operating activities substantially decreased; the Group's total bank facilities and utilized amounts both increased, while current ratio, quick ratio, and debt-to-equity ratio all deteriorated, and the gearing ratio significantly increased | Indicator | June 30, 2025 (Thousand HKD) | December 31, 2024 (Thousand HKD) | Change (%) | | :--- | :--- | :--- | :--- | | Net current assets | 353,100 | 370,200 | -4.6% | | Bank balances and cash | 348,300 | 262,400 | +32.7% | | Net cash generated from operating activities (for the period) | 33,800 | 136,900 | -75.3% | - As of June 30, 2025, total bank facilities amounted to approximately **HKD 1,299.8 Million**, with approximately **HKD 621.2 Million** utilized (December 31, 2024: total approximately HKD 1,251.9 Million, utilized approximately HKD 430.8 Million)[42](index=42&type=chunk) - Capital expenditure for the period was approximately **HKD 46.2 Million**, primarily for purchasing plant and machinery, a decrease from HKD 65.8 Million as of December 31, 2024[43](index=43&type=chunk) Financial Ratios | Financial Ratio | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | Current Ratio | 123.6% | 128.6% | -5.0pp | | Quick Ratio | 89.6% | 91.8% | -2.2pp | | Gearing Ratio | 57.9% | 40.1% | +17.8pp | | Debt to Equity Ratio | 23.2% | 13.9% | +9.3pp | - The Group primarily operates in Hong Kong, Mainland China, the US, and Vietnam, facing Renminbi and Vietnamese Dong foreign exchange risks, but no significant impact on operating results is expected, and no hedging instruments are currently used[45](index=45&type=chunk) - The Group has treasury policies to effectively control treasury operations, reduce borrowing costs, and maintain sufficient cash and bank facilities for daily operations and short-term funding needs[46](index=46&type=chunk) [Outlook](index=22&type=section&id=%E5%89%8D%E6%99%AF) Despite an unstable and challenging global economic environment, the Group anticipates continued volatility in the coming year; the Group will continue to explore high-growth potential businesses and has strengthened business relationships, leveraged operational synergies, and expanded its customer base by increasing its equity stake in European entity MDK Holdings ApS to 55%; looking ahead, the Group will deepen its expansion into European and American markets, with Mattress-in-a-box product sales expected to continue growing, bringing more sales and profit to the Group - The global economic environment is expected to remain volatile and challenging in the coming year[48](index=48&type=chunk) - The Group has increased its equity stake in European entity **MDK Holdings ApS** to **55%**, expecting to strengthen business relationships, leverage operational synergies, consolidate strategic cooperation, and expand its customer base[48](index=48&type=chunk)[49](index=49&type=chunk) - The Group will deepen its expansion into European and American markets, with **Mattress-in-a-box** product sales expected to continue growing, bringing more sales and profit to the Group[49](index=49&type=chunk) [Other Information](index=23&type=section&id=%E5%85%B6%E4%BB%96%E8%B3%87%E6%96%99) [Future Plans for Material Investments or Capital Assets](index=23&type=section&id=%E9%87%8D%E5%A4%A7%E6%8A%95%E8%B3%87%E6%88%96%E8%B3%87%E6%9C%AC%E8%B3%87%E7%94%A2%E7%9A%84%E6%97%A5%E5%BE%8C%E8%A8%88%E5%8A%83) Except for the investment in MDK Holdings ApS disclosed in the 'Outlook' section, the Group currently has no other plans for material investments or capital assets - Aside from the disclosed investment in MDK Holdings ApS, the Group has no other plans for material investments or capital assets[50](index=50&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=23&type=section&id=%E8%B3%BC%E8%B2%B7%E3%80%81%E5%87%BA%E5%94%AE%E6%88%96%E8%B4%96%E5%9B%9E%E6%9C%AC%E5%85%AC%E5%8F%B8%E4%B8%8A%E5%B8%82%E8%AD%89%E5%88%B8) During the reporting period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - During the reporting period, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[51](index=51&type=chunk) [Interim Dividends](index=23&type=section&id=%E4%B8%AD%E6%9C%9F%E8%82%A1%E6%81%AF) The Board has resolved to declare an interim dividend of 0.5 HK cents per share for the reporting period, totaling approximately HKD 8.75 Million, to be paid on October 8, 2025, to shareholders whose names appear on the register of members on September 19, 2025 - The Board declared an interim dividend of **0.5 HK cents** per share (2024: 1.0 HK cents), totaling approximately **HKD 8.75 Million**[52](index=52&type=chunk) - The dividend will be paid on **October 8, 2025**, to shareholders whose names appear on the register of members on **September 19, 2025**[52](index=52&type=chunk) [Closure of Register of Members](index=23&type=section&id=%E6%9A%AB%E5%81%9C%E8%BE%A6%E7%90%86%E8%82%A1%E4%BB%BD%E9%81%8E%E6%88%B6%E7%99%BB%E8%A8%98) To determine eligibility for the interim dividend, the Company will suspend the registration of share transfers from September 16, 2025, to September 19, 2025, with the record date being September 19, 2025 - The register of members will be closed from **September 16 to September 19, 2025**, with the record date being **September 19, 2025**, to determine eligibility for the interim dividend[53](index=53&type=chunk) [Employees and Remuneration Policies](index=23&type=section&id=%E5%83%B1%E5%93%A1%E5%8F%8A%E8%96%AA%E9%85%AC%E6%94%BF%E7%AD%96) As of June 30, 2025, the Group's total number of employees was 3,742, an increase from the prior year; total staff costs for the reporting period also increased to approximately HKD 312.2 Million, mainly due to the increased headcount; the Group provides competitive remuneration packages, benefits, and continuous training | Indicator | June 30, 2025 | June 30, 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Total number of employees | 3,742 people | 3,208 people | +16.6% | | Total staff costs (Thousand HKD) | 312,243 | 302,983 | +3.1% | - The increase in staff costs is primarily due to an increase in the number of employees[54](index=54&type=chunk) - The Group provides competitive remuneration packages, benefits (such as housing, travel allowances, medical insurance), and continuous training[55](index=55&type=chunk) [Corporate Governance Practices](index=24&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%B8%B8%E8%A6%8F) The Company is committed to maintaining high standards of corporate governance and has adopted the Corporate Governance Code set out in Appendix C1 Part 2 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited; during the reporting period, the Company complied with all code provisions - The Company has adopted and complied with the Corporate Governance Code set out in **Appendix C1 Part 2** of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[56](index=56&type=chunk) [Standard Code for Securities Transactions](index=24&type=section&id=%E9%80%B2%E8%A1%8C%E8%AD%89%E5%88%B8%E4%BA%A4%E6%98%93%E7%9A%84%E6%A8%99%E6%BA%96%E5%AE%88%E5%89%87) The Company has adopted a code of conduct for directors' securities transactions no less exacting than the standard set out in Appendix C3 of the Listing Rules, and all directors confirmed compliance with the code during the reporting period - The Company has adopted and complied with a code of conduct for directors' securities transactions no less exacting than the standard set out in **Appendix C3** of the Listing Rules[57](index=57&type=chunk) [Review of Interim Results](index=24&type=section&id=%E5%AF%A9%E9%96%B1%E4%B8%AD%E6%9C%9F%E6%A5%AD%E7%B8%BE) The Board's Audit Committee has reviewed the Group's interim financial information and recommended its adoption by the Board; PricewaterhouseCoopers, the Group's auditor, has reviewed the unaudited condensed consolidated interim financial information in accordance with Hong Kong Standard on Review Engagements 2410 - The Board's Audit Committee has reviewed the interim financial information and recommended its adoption by the Board[58](index=58&type=chunk) - PricewaterhouseCoopers, the Group's auditor, has reviewed the interim financial information in accordance with **Hong Kong Standard on Review Engagements 2410**[59](index=59&type=chunk) [Publication of Interim Results and 2025 Interim Report on HKEX and Company Website](index=25&type=section&id=%E6%96%BC%E8%81%AF%E4%BA%A4%E6%89%80%E5%8F%8A%E6%9C%AC%E5%85%AC%E5%8F%B8%E7%B6%B2%E7%AB%99%E5%88%8A%E7%99%BB%E4%B8%AD%E6%9C%9F%E6%A5%AD%E7%B8%BE%E5%8F%8A2025%E5%B9%B4%E4%B8%AD%E6%9C%9F%E5%A0%B1%E5%91%8A) This interim results announcement will be published on the website of The Stock Exchange of Hong Kong Limited and the Company's website, and the interim report containing all information required by the Listing Rules will be published in due course - This interim results announcement will be published on the website of The Stock Exchange of Hong Kong Limited (www.hkexnews.hk) and the Company's website (www.sinomax.com/group)[60](index=60&type=chunk) - The interim report, containing all information required by the Listing Rules, will be published on the HKEX and Company websites in due course[60](index=60&type=chunk) [Board of Directors](index=25&type=section&id=%E8%91%A3%E4%BA%8B%E6%9C%83) The Company's Board of Directors includes Mr. Lam Chi Fan (Chairman) as a non-executive director, Mr. Cheung Tung (President), Mr. Chan Fung, Mr. Lam Kam Cheung (Chief Financial Officer and Company Secretary), and Ms. Lam Fei Man as executive directors, and Mr. Wong Chi Keung, Mr. Cheung Kit, and Dr. Cheung Wah Keung as independent non-executive directors - The Board of Directors comprises non-executive directors, executive directors, and independent non-executive directors, with **Mr. Lam Chi Fan** as Chairman, **Mr. Cheung Tung** as President, and **Mr. Lam Kam Cheung** as Chief Financial Officer and Company Secretary[61](index=61&type=chunk)