[Financial Highlights](index=2&type=section&id=%E8%B2%A1%E5%8B%99%E6%91%98%E8%A6%81) [Interim Results and Five-Year Financial Summary](index=2&type=section&id=%E4%B8%AD%E6%9C%9F%E6%A5%AD%E7%B8%BE%E5%8F%8A%E4%BA%94%E5%B9%B4%E8%B2%A1%E5%8B%99%E6%91%98%E8%A6%81) The Group's net loss for the six months ended June 30, 2025, improved to **S$0.73 million** from **S$1.42 million** in the prior period, primarily due to fair value gains on financial derivatives and reduced expenses Key Financial Performance Summary (S$ thousand) | Metric | June 30, 2025 (Six Months) | June 30, 2024 (Six Months) | | :--- | :--- | :--- | | Revenue | 1,390 | 1,755 | | Loss Before Tax | (703) | (1,249) | | Loss for the Period | (726) | (1,419) | | Loss Per Share (Singapore cents) | (0.04) | (0.07) | Key Financial Position Summary (S$ thousand) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Assets | 32,484 | 33,078 | | Total Liabilities | 12,968 | 12,651 | | Net Current Assets | 19,824 | 21,012 | | Net Assets | 19,516 | 20,427 | | Net Asset Value Per Share (Singapore cents) | 0.98 | 1.02 | - Net loss for the period was **S$0.73 million**, an improvement of **48.6%** from the prior period's **S$1.42 million** loss, primarily due to fair value gains on financial derivatives of approximately **S$0.67 million** (prior period: loss of S$0.29 million), and reduced staff costs of **S$0.23 million** and income tax expense of **S$0.15 million**[9](index=9&type=chunk) - Revenue decreased by **S$0.37 million** from **S$1.76 million** in the prior period to **S$1.39 million** in the current period, mainly due to lower dividend income, management fees, and performance fees, partially offset by a one-off project tender fee of **S$0.50 million**[9](index=9&type=chunk) - Total staff costs decreased by **S$0.23 million** (**11.6%**) to **S$1.75 million**, primarily due to lower discretionary bonuses and operational streamlining[9](index=9&type=chunk) - The Company neither paid nor proposed any dividends for the six months ended June 30, 2025, consistent with the prior period[9](index=9&type=chunk) [Review Report on Interim Condensed Consolidated Financial Statements](index=4&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8%E5%AF%A9%E9%96%B1%E5%A0%B1%E5%91%8A) [To the Members of ZACD Group Ltd.](index=4&type=section&id=%E8%87%B4%E5%82%91%E5%9C%B0%E9%9B%86%E5%9C%98%E6%9C%89%E9%99%90%E5%85%AC%E5%8F%B8%E6%88%90%E5%93%A1) Ernst & Young LLP reviewed ZACD Group Ltd.'s interim condensed consolidated financial statements for the six months ended June 30, 2025, concluding no material issues indicating non-compliance with IAS 34 - The review scope is narrower than an audit, thus no audit opinion is expressed, but no matters were identified indicating that the financial statements are not prepared in all material respects in accordance with IAS 34[11](index=11&type=chunk)[12](index=12&type=chunk) [Interim Condensed Consolidated Financial Statements](index=6&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8) [Interim Condensed Consolidated Statement of Profit or Loss](index=6&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%90%8D%E7%9B%8A%E8%A1%A8) The Group's consolidated statement of profit or loss for the six months ended June 30, 2025, shows revenue of **S$1,390 thousand**, a loss before tax of **S$703 thousand**, a loss for the period of **S$726 thousand**, and basic and diluted loss per share of **0.04 Singapore cents** Interim Condensed Consolidated Statement of Profit or Loss (S$ thousand) | Metric | June 30, 2025 (Unaudited) | June 30, 2024 (Unaudited) | | :--- | :--- | :--- | | Revenue | 1,390 | 1,755 | | Other Income and Gains | 202 | 472 | | Staff Costs | (1,754) | (1,984) | | Fair Value Gains/(Losses) on Financial Derivatives | 672 | (285) | | Loss Before Tax | (703) | (1,249) | | Income Tax Expense | (23) | (170) | | Loss for the Period Attributable to Owners of the Company | (726) | (1,419) | | Basic and Diluted Loss Per Share (Singapore cents) | (0.04) | (0.07) | [Interim Condensed Consolidated Statement of Comprehensive Income](index=7&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E5%85%A8%E9%9D%A2%E6%94%B6%E7%9B%8A%E8%A1%A8) The Group's consolidated statement of comprehensive income for the six months ended June 30, 2025, reports a loss for the period of **S$726 thousand** and other comprehensive loss of **S$185 thousand**, resulting in a total comprehensive loss of **S$911 thousand** Interim Condensed Consolidated Statement of Comprehensive Income (S$ thousand) | Metric | June 30, 2025 (Unaudited) | June 30, 2024 (Unaudited) | | :--- | :--- | :--- | | Loss for the Period | (726) | (1,419) | | Fair Value Changes of Equity Investments | (145) | (189) | | Fair Value Changes of Investments in Fund Entities | (67) | (159) | | Exchange Differences Arising from Translation of Foreign Operations | 27 | (13) | | Other Comprehensive Loss for the Period | (185) | (361) | | Total Comprehensive Loss for the Period Attributable to Owners of the Company | (911) | (1,780) | [Interim Condensed Consolidated Statement of Financial Position](index=8&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) As of June 30, 2025, the Group's consolidated statement of financial position shows total assets of **S$32,484 thousand**, total liabilities of **S$12,968 thousand**, and net assets of **S$19,516 thousand** Interim Condensed Consolidated Statement of Financial Position (S$ thousand) | Metric | June 30, 2025 (Unaudited) | December 31, 2024 (Audited) | | :--- | :--- | :--- | | Total Non-Current Assets | 1,687 | 2,086 | | Total Current Assets | 30,797 | 30,992 | | Total Current Liabilities | 10,973 | 9,980 | | Net Current Assets | 19,824 | 21,012 | | Total Non-Current Liabilities | 1,995 | 2,671 | | Net Assets | 19,516 | 20,427 | | Total Equity | 19,516 | 20,427 | [Interim Condensed Consolidated Statement of Changes in Equity](index=10&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E6%AC%8A%E7%9B%8A%E8%AE%8A%E5%8B%95%E8%A1%A8) The Group's consolidated statement of changes in equity for the six months ended June 30, 2025, shows total equity at the beginning of the period of **S$20,427 thousand**, a loss for the period of **S$726 thousand**, and other comprehensive loss of **S$185 thousand**, resulting in total equity at the end of the period of **S$19,516 thousand** Interim Condensed Consolidated Statement of Changes in Equity (S$ thousand) | Metric | June 30, 2025 (Unaudited) | June 30, 2024 (Unaudited) | | :--- | :--- | :--- | | Total Equity at Beginning of Period | 20,427 | 22,487 | | Loss for the Period | (726) | (1,419) | | Total Other Comprehensive Loss/(Income) for the Period | (185) | (361) | | Total Equity at End of Period | 19,516 | 20,707 | [Interim Condensed Consolidated Statement of Cash Flows](index=12&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E7%8F%BE%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) The Group's consolidated statement of cash flows for the six months ended June 30, 2025, shows net cash used in operating activities of **S$832 thousand**, net cash used in investing activities of **S$1,105 thousand**, and net cash from financing activities of **S$893 thousand**, leading to a net decrease in cash and cash equivalents of **S$1,044 thousand** Interim Condensed Consolidated Statement of Cash Flows (S$ thousand) | Metric | June 30, 2025 (Unaudited) | June 30, 2024 (Unaudited) | | :--- | :--- | :--- | | Net Cash Flows Used in Operating Activities | (832) | (879) | | Net Cash Flows Used in Investing Activities | (1,105) | (4,393) | | Net Cash Flows From/(Used in) Financing Activities | 893 | (546) | | Net Decrease in Cash and Cash Equivalents | (1,044) | (5,818) | | Cash and Cash Equivalents at End of Period | 4,298 | 8,775 | [Notes to the Interim Condensed Consolidated Financial Statements](index=14&type=section&id=%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8%E9%99%84%E6%B3%A8) [1. Company Information](index=14&type=section&id=1.%20%E5%85%AC%E5%8F%B8%E8%B3%87%E6%96%99) ZACD Group Ltd. is an investment holding company incorporated in Singapore, primarily engaged in investment management, acquisition and project management, property management and leasing management, and financial advisory services - The company is registered in Singapore, with primary businesses including investment management, acquisition and project management, property management and leasing management, and financial advisory services[36](index=36&type=chunk)[38](index=38&type=chunk) [2. Basis of Preparation and Changes in the Group's Accounting Policies](index=14&type=section&id=2.%20%E7%B7%A8%E8%A3%BD%E5%9F%BA%E6%BA%96%E5%8F%8A%E6%9C%AC%E9%9B%86%E5%9C%98%E6%9C%83%E8%A8%88%E6%94%BF%E7%AD%96%E8%AE%8A%E6%9B%B4) The interim condensed consolidated financial statements are prepared in accordance with IAS 34 and presented in Singapore dollars, with no significant impact from new standards, interpretations, and amendments adopted in the current period - The financial statements are prepared in accordance with IAS 34 and presented in S$ thousand[37](index=37&type=chunk) - New standards, interpretations, and amendments adopted in the current period have no significant impact on the Group's interim results[40](index=40&type=chunk) [3. Operating Segment Information](index=15&type=section&id=3.%20%E7%B6%93%E7%87%9F%E5%88%86%E9%83%A8%E8%B3%87%E6%96%99) The Group's operating segments include investment management (special purpose entity investment management and fund management), acquisition and project management, property management and leasing management, and financial advisory, with management allocating resources and assessing performance based on each business unit's results - The Group's main operating segments include investment management (special purpose entity investment management, fund management), acquisition and project management, property management and leasing management, and financial advisory[38](index=38&type=chunk)[41](index=41&type=chunk)[45](index=45&type=chunk)[48](index=48&type=chunk)[50](index=50&type=chunk)[51](index=51&type=chunk) Segment Revenue for the Six Months Ended June 30, 2025 (S$ thousand) | Segment | Revenue from External Customers | | :--- | :--- | | Special Purpose Entity Investment Management | 174 | | Fund Management | 1,145 | | Acquisition and Project Management | 53 | | Property Management and Leasing Management | 18 | | Financial Advisory | – | | **Total** | **1,390** | Segment Results for the Six Months Ended June 30, 2025 (S$ thousand) | Segment | Segment Results | | :--- | :--- | | Special Purpose Entity Investment Management | (156) | | Fund Management | 644 | | Acquisition and Project Management | (77) | | Property Management and Leasing Management | (11) | | Financial Advisory | (49) | | **Total** | **351** | Revenue by Customer Location for the Six Months Ended June 30, 2025 (S$ thousand) | Region | Revenue | | :--- | :--- | | Singapore | 1,099 | | Malaysia | 18 | | Australia | 53 | | British Virgin Islands | 220 | | **Total** | **1,390** | [4. Revenue, Other Income and Gains](index=26&type=section&id=4.%20%E6%94%B6%E5%85%A5%E3%80%81%E5%85%B6%E4%BB%96%E6%94%B6%E5%85%A5%E5%8F%8A%E6%94%B6%E7%9B%8A) The Group's revenue primarily derives from investment management, acquisition and project management, and property management and leasing management service fees, while other income and gains include interest income, government grants, and corporate business service fees Revenue Breakdown (S$ thousand) | Revenue Source | June 30, 2025 (Unaudited) | June 30, 2024 (Unaudited) | | :--- | :--- | :--- | | Special Purpose Entity Investment Management Fees | 174 | 108 | | Fund Management Fees | 1,145 | 1,532 | | Acquisition and Project Management Fees | 53 | 98 | | Property Management and Leasing Management Fees | 18 | 17 | | **Total Revenue** | **1,390** | **1,755** | Other Income and Gains Breakdown (S$ thousand) | Other Income and Gains | June 30, 2025 (Unaudited) | June 30, 2024 (Unaudited) | | :--- | :--- | :--- | | Interest Income | 33 | 374 | | Government Grants | 8 | 3 | | Corporate Business Service Fees | 75 | 80 | | Gain on Disposal of Property, Plant and Equipment | 6 | – | | Operating Lease Income | 8 | 8 | | Net Exchange Differences | – | 7 | | Others | 72 | – | | **Total** | **202** | **472** | [5. Loss Before Tax](index=29&type=section&id=5.%20%E9%99%A4%E7%A8%85%E5%89%8D%E8%99%A7%E6%90%8D) The Group's loss before tax is primarily influenced by fair value gains on financial derivatives, dividend income, professional fees, and interest expenses Loss Before Tax Components (S$ thousand) | Item | June 30, 2025 (Unaudited) | June 30, 2024 (Unaudited) | | :--- | :--- | :--- | | Auditor's Remuneration | 90 | 70 | | Dividend Income | (150) | (284) | | Professional Fees | 185 | 12 | | Net Impairment Loss/(Reversal) on Trade Receivables | 14 | (7) | | Fair Value Gains/(Losses) on Financial Derivatives | 672 | (285) | | Interest Expense | 275 | 292 | [6. Income Tax Expense](index=30&type=section&id=6.%20%E6%89%80%E5%BE%97%E7%A8%85%E9%96%8B%E6%94%AF) The Group's income tax expense is calculated based on the actual tax rate applied to the expected total annual profit Income Tax Expense (S$ thousand) | Metric | June 30, 2025 (Unaudited) | June 30, 2024 (Unaudited) | | :--- | :--- | :--- | | Income Tax Expense | 23 | 170 | [7. Loss Per Share Attributable to Owners of the Company](index=30&type=section&id=7.%20%E6%9C%AC%E5%85%AC%E5%8F%B8%E6%8B%A5%E6%9C%89%E4%BA%BA%E6%87%89%E5%8D%A0%E6%AF%8F%E8%82%A1%E8%99%A7%E6%90%8D) The basic and diluted loss per share attributable to owners of the Company is calculated based on the loss for the period and the weighted average number of ordinary shares Loss Per Share Calculation (S$ thousand/share) | Metric | June 30, 2025 (Unaudited) | June 30, 2024 (Unaudited) | | :--- | :--- | :--- | | Loss for the Period Attributable to Owners of the Company | (703) | (1,419) | | Weighted Average Number of Ordinary Shares | 2,000,000,000 | 2,000,000,000 | [8. Dividends](index=31&type=section&id=8.%20%E8%82%A1%E6%81%AF) The Company neither paid nor proposed any dividends for the six months ended June 30, 2025, consistent with the prior period - The Company neither paid nor proposed any dividends for the six months ended June 30, 2025[71](index=71&type=chunk) [9. Property, Plant and Equipment](index=31&type=section&id=9.%20%E7%89%A9%E6%A5%AD%E3%80%81%E5%BB%A0%E6%88%BF%E5%8F%8A%E8%A8%AD%E5%82%99) During the period, the Group did not acquire assets, disposed of assets with a net book value of **S$19 thousand**, and recorded depreciation of **S$31 thousand**, while right-of-use assets had no additions or disposals and amortization of **S$126 thousand** - For the six months ended June 30, 2025, the Group did not acquire assets, and disposed of assets with a net book value of **S$19 thousand** (prior period: nil)[72](index=72&type=chunk) - Depreciation of property, plant and equipment amounted to **S$31 thousand** (prior period: S$52 thousand)[72](index=72&type=chunk) - Amortization of right-of-use assets was **S$126 thousand** (prior period: S$126 thousand), with no additions or disposals[72](index=72&type=chunk) [10. Equity Investments and Investments in Fund Entities](index=31&type=section&id=10.%20%E8%82%A1%E6%9C%AC%E8%AD%89%E5%88%B8%E6%8A%95%E8%B3%87%E5%8F%8A%E5%9F%BA%E9%87%91%E5%AF%A6%E9%AB%94%E6%8A%95%E8%B3%87) The Group's equity investments and investments in fund entities are both accounted for at fair value through other comprehensive income, with fair value changes for both investment types recognized as losses in the current period Equity Investments (S$ thousand) | Metric | June 30, 2025 (Unaudited) | December 31, 2024 (Audited) | | :--- | :--- | :--- | | Unlisted Equity Shares, at Fair Value | 58 | 203 | - Fair value changes of equity investments for the period were recognized as a loss of **S$145 thousand** (prior period: S$189 thousand)[74](index=74&type=chunk) Investments in Fund Entities (S$ thousand) | Metric | June 30, 2025 (Unaudited) | December 31, 2024 (Audited) | | :--- | :--- | :--- | | Unlisted Equity Shares, at Fair Value | 1,261 | 1,328 | - Fair value changes of investments in fund entities for the period were recognized as a loss of **S$67 thousand** (prior period: S$159 thousand)[76](index=76&type=chunk) [11. Trade Receivables](index=34&type=section&id=11.%20%E8%B2%BF%E6%98%93%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85) The Group's net trade receivables amounted to **S$4,545 thousand**, with an impairment loss provision of **S$203 thousand**, and are primarily settled on 30-day credit terms with regular credit assessments Trade Receivables (S$ thousand) | Metric | June 30, 2025 (Unaudited) | December 31, 2024 (Audited) | | :--- | :--- | :--- | | Trade Receivables | 4,748 | 4,962 | | Less: Provision for Impairment Losses | (203) | (214) | | **Net Amount** | **4,545** | **4,748** | Ageing Analysis of Trade Receivables (S$ thousand) | Ageing | June 30, 2025 (Unaudited) | December 31, 2024 (Audited) | | :--- | :--- | :--- | | Within One Month | 1,118 | 1,168 | | One to Two Months | 4 | 8 | | Two to Three Months | 74 | 8 | | Over Three Months | 3,349 | 3,564 | | **Total** | **4,545** | **4,748** | - As of June 30, 2025, trade receivables from related parties amounted to **S$4,258 thousand** (December 31, 2024: S$4,294 thousand)[81](index=81&type=chunk) [12. Capitalized Contract Costs](index=37&type=section&id=12.%20%E8%B3%87%E6%9C%AC%E5%8C%96%E5%90%88%E7%B4%84%E6%88%90%E6%9C%AC) Capitalized contract costs primarily represent commission costs paid to agents, with a period-end balance of **S$346 thousand** and amortization of **S$60 thousand** for the current period Movement in Capitalized Contract Costs (S$ thousand) | Metric | June 30, 2025 (Unaudited) | December 31, 2024 (Audited) | | :--- | :--- | :--- | | Beginning of Period/Year | 406 | 337 | | Additions | – | 182 | | Amortization | (60) | (113) | | **End of Period/Year** | **346** | **406** | [13. Prepayments, Deposits and Other Receivables](index=38&type=section&id=13.%20%E9%A0%90%E4%BB%98%E6%AC%BE%E9%A0%85%E3%80%81%E6%8C%89%E9%87%91%E5%8F%8A%E5%85%B6%E4%BB%96%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85) The Group's total prepayments, deposits, and other receivables amounted to **S$744 thousand**, comprising current prepayments, deposits, interest receivables, and other receivables, as well as non-current other receivables Prepayments, Deposits and Other Receivables (S$ thousand) | Metric | June 30, 2025 (Unaudited) | December 31, 2024 (Audited) | | :--- | :--- | :--- | | Current: Prepayments | 213 | 332 | | Current: Deposits | 79 | 134 | | Current: Interest Receivables | 174 | 143 | | Current: Other Receivables | 102 | 24 | | Non-Current: Others | 176 | 186 | | **Total at End of Period/Year** | **744** | **819** | [14. Loans and Related Receivables](index=39&type=section&id=14.%20%E8%B2%B8%E6%AC%BE%E5%8F%8A%E7%9B%B8%E9%97%9C%E6%87%89%E6%94%B6%E6%AC%BE%E9%A0%85) The Group provided bridge loans and related interest receivables to several related parties, primarily for real estate development projects, with a net amount of **S$19,756 thousand** as of June 30, 2025, and an impairment loss provision of **S$5,085 thousand** Loans and Related Receivables (S$ thousand) | Metric | June 30, 2025 (Unaudited) | December 31, 2024 (Audited) | | :--- | :--- | :--- | | Bridge Loans to Related Parties | 23,876 | 23,571 | | Interest Receivables on Loans to Related Parties | 965 | 936 | | Less: Provision for Impairment Losses | (5,085) | (5,085) | | **Net Amount** | **19,756** | **19,422** | - Bridge financing provided to ZACD LV Development Fund, totaling **S$12,777 thousand**, accrues interest at **6%** per annum, but interest charges have been temporarily waived by the lender from January 1, 2025[91](index=91&type=chunk) - Bridge financing provided to ZACD Mount Emily Residential Development Fund, totaling **S$4,050 thousand**, accrues interest at **6%** per annum, but interest charges have been temporarily waived by the lender from January 1, 2025[93](index=93&type=chunk) - Loans and related receivables to ZACD Media Circle Fund were fully repaid as of June 30, 2025[99](index=99&type=chunk) [15. Cash and Cash Equivalents](index=46&type=section&id=15.%20%E7%8F%BE%E9%87%91%E5%8F%8A%E7%8F%BE%E9%87%91%E7%AD%89%E5%83%B9%E7%89%A9) As of June 30, 2025, the Group's cash and cash equivalents amounted to **S$4,298 thousand**, primarily held in banks in Singapore, Hong Kong, and Australia, earning interest at floating rates Cash and Cash Equivalents (S$ thousand) | Metric | June 30, 2025 (Unaudited) | December 31, 2024 (Audited) | | :--- | :--- | :--- | | Cash and Cash Equivalents | 4,298 | 5,314 | Cash and Bank Balances Denominated in Foreign Currencies (S$ thousand) | Currency | June 30, 2025 (Unaudited) | December 31, 2024 (Audited) | | :--- | :--- | :--- | | HKD | 35 | 38 | | AUD | 288 | 291 | [16. Bank Borrowings](index=46&type=section&id=16.%20%E9%8A%80%E8%A1%8C%E8%B2%B8%E6%AC%BE) The Group's bank borrowings consist of a 5-year temporary bridging loan guaranteed under the Enterprise Financing Scheme, with a fixed interest rate of **3.0%** per annum, repayable in 60 monthly installments Bank Borrowings (S$ thousand) | Metric | June 30, 2025 (Unaudited) | December 31, 2024 (Audited) | | :--- | :--- | :--- | | Temporary Bridging Loan, Unsecured: Current | 198 | 590 | | **Total Bank Borrowings** | **198** | **590** | - The temporary bridging loan has a fixed interest rate of **3.0%** per annum, repayable in 60 monthly installments[104](index=104&type=chunk) [17. Lease Liabilities](index=47&type=section&id=17.%20%E7%A7%9F%E8%B3%83%E8%B2%A0%E5%82%B5) The Group's lease liabilities primarily relate to office property leases, comprising both current and non-current portions Lease Liabilities (S$ thousand) | Metric | June 30, 2025 (Unaudited) | December 31, 2024 (Audited) | | :--- | :--- | :--- | | Office Property Leases — Current | 108 | 262 | | Office Property Leases — Non-Current | 6 | 10 | | **Total Lease Liabilities** | **114** | **272** | [18. Financial Derivatives](index=48&type=section&id=18.%20%E9%87%91%E8%9E%8D%E8%A1%8D%E7%94%9F%E5%B7%A5%E5%85%B7) The Company granted a put option to Top Global Limited, an investor in ZACD LV Development Fund, and recognized a fair value gain of **S$672 thousand** in the current period due to the re-assessment of the put option's fair value Financial Derivatives (S$ thousand) | Metric | June 30, 2025 (Unaudited) | December 31, 2024 (Audited) | | :--- | :--- | :--- | | Financial Derivatives | 1,902 | 2,574 | - A fair value gain of **S$672 thousand** on financial derivatives was recognized in the current period (prior period: loss of S$285 thousand), primarily from the re-assessment of the fair value of the put option granted to Top Global Limited[107](index=107&type=chunk) [19. Share Capital](index=48&type=section&id=19.%20%E8%82%A1%E6%9C%AC) The Company's issued and fully paid share capital consists of **2,000,000,000** ordinary shares, amounting to **S$29,866 thousand** Share Capital (S$ thousand) | Metric | June 30, 2025 (Unaudited) | December 31, 2024 (Audited) | | :--- | :--- | :--- | | Issued and Fully Paid: 2,000,000,000 Ordinary Shares | 29,866 | 29,866 | [20. Related Party Transactions](index=49&type=section&id=20.%20%E9%97%9C%E9%80%A3%E6%96%B9%E4%BA%A4%E6%98%93) The Group engages in transactions with numerous related parties, including investment special purpose entities, private funds, development special purpose entities, and companies jointly controlled by the controlling shareholder, with key transaction types encompassing dividend income, performance fees, and fund management fees - Related parties include investment special purpose entities, private funds managed by the Group, development special purpose entities, and companies jointly controlled by the controlling shareholder[110](index=110&type=chunk)[111](index=111&type=chunk)[112](index=112&type=chunk)[113](index=113&type=chunk)[114](index=114&type=chunk)[115](index=115&type=chunk) Summary of Related Party Transactions (S$ thousand) | Transaction Type | June 30, 2025 (Unaudited) | June 30, 2024 (Unaudited) | | :--- | :--- | :--- | | Investment Management — Dividend Income | 150 | 284 | | Investment Management — Performance Fees | 167 | 943 | | Investment Management — Fund Management Fees | 578 | 232 | | Office and Transportation Expenses | 30 | 30 | - Dividend income for the period primarily originated from ZACD (Punggol Central) Ltd., ZACD (Woodlands2) Pte Ltd, and ZACD (Jurong) Pte Ltd[116](index=116&type=chunk) - Performance fees for the period primarily originated from ZACD (BBW6) Ltd., while the prior period's fees were mainly from ZACD (Shunfu) Ltd., ZACD (Shunfu2) Ltd., and ZACD (Mandai) Ltd.[116](index=116&type=chunk) - Fund management fees significantly increased in the current period, mainly from ZACD Media Circle Fund and ZACD Laserblue Pte Ltd[117](index=117&type=chunk) [21. Commitments](index=58&type=section&id=21.%20%E6%89%BF%E6%93%94) As of the end of the period, the Group had no other significant commitments beyond those disclosed in the report - As of the end of the period, the Group had no other significant commitments[121](index=121&type=chunk) [22. Financial Guarantees](index=59&type=section&id=22.%20%E8%B2%A1%E5%8B%99%E6%93%94%E4%BF%9D) The Company provided financial guarantees for several real estate development projects, including La Ville Development, BBEC Development, Mount Emily Properties, Mandai Development, and Landmark Development, to support the loan financing of related special purpose entities and funds - Provided a loan financing guarantee for La Ville Development with a principal amount of **S$129.09 million**, representing **75.0%** of the total liabilities of the related development special purpose entity[123](index=123&type=chunk) - Provided a loan financing guarantee for BBEC Development with a principal amount of **S$29.98 million**, representing **10.0%** of the total liabilities of the related development special purpose entity[124](index=124&type=chunk) - Provided a loan financing guarantee for Mount Emily Properties with a principal amount of **S$19.25 million**, representing the total liabilities of the related development special purpose entity[126](index=126&type=chunk) - Provided a loan financing guarantee for Mandai Development with a principal amount of **S$28.99 million**, representing **60.0%** of the total liabilities of the related development special purpose entity[127](index=127&type=chunk) - Provided a loan financing guarantee for Landmark Development with a total principal amount of **S$150.74 million**, representing **39.2%** of the total liabilities of the related development special purpose entity[128](index=128&type=chunk) [23. Contingent Liabilities](index=61&type=section&id=23.%20%E6%88%96%E7%84%B6%E8%B2%A0%E5%82%B5) The Group has contingent liabilities related to ZACD Australia Hospitality Fund and ZACD US Fund, involving legal actions to recover funds, but external legal counsel found no negligence, fraud, or dishonesty by Group management, thus no provision has been made - The Group is pursuing recovery actions for cases related to ZACD Australia Hospitality Fund and ZACD US Fund to recover deposits[129](index=129&type=chunk)[130](index=130&type=chunk) - External legal counsel found no evidence of negligence, fraud, or dishonesty by the Group or its management, therefore no provision has been made in the financial statements for this contingent liability[131](index=131&type=chunk) - As of June 30, 2025, legal actions have incurred cumulative legal fees of **S$1,808 thousand**[131](index=131&type=chunk) [24. Financial Instruments by Category](index=63&type=section&id=24.%20%E6%8C%89%E9%A1%9E%E5%88%A5%E5%8A%83%E5%88%86%E7%9A%84%E9%87%91%E8%9E%8D%E5%B7%A5%E5%85%B7) The Group's financial instruments are categorized as financial assets and liabilities measured at fair value through other comprehensive income, at amortized cost, and financial liabilities measured at fair value through profit or loss Financial Assets as of June 30, 2025 (S$ thousand) | Category | Fair Value Through Other Comprehensive Income | Financial Assets Measured at Amortized Cost | Total | | :--- | :--- | :--- | :--- | | Equity Investments | 58 | – | 58 | | Investments in Fund Entities | 1,261 | – | 1,261 | | Trade Receivables | – | 4,545 | 4,545 | | Loans and Related Receivables | – | 19,756 | 19,756 | | Cash and Cash Equivalents | – | 4,298 | 4,298 | | **Total** | **1,319** | **30,414** | **31,733** | Financial Liabilities as of June 30, 2025 (S$ thousand) | Category | Fair Value Through Profit or Loss | Financial Liabilities Measured at Amortized Cost | Total | | :--- | :--- | :--- | :--- | | Financial Derivatives | 1,902 | – | 1,902 | | Financial Liabilities Included in Other Payables and Accruals | – | 2,401 | 2,401 | | Lease Liabilities | – | 114 | 114 | | Amounts Due to Related Parties | – | 7,413 | 7,413 | | Bank Borrowings | – | 198 | 198 | | **Total** | **1,902** | **10,163** | **12,065** | [25. Fair Value and Fair Value Hierarchy of Financial Instruments](index=67&type=section&id=25.%20%E9%87%91%E8%9E%8D%E5%B7%A5%E5%85%B7%E4%B9%8B%E5%85%AC%E5%B9%B3%E5%80%BC%E5%8F%8A%E5%85%AC%E5%B9%B3%E5%80%BC%E7%AD%89%E7%B4%9A) The Group's financial instrument fair values are primarily estimated using discounted cash flow models for unlisted equity and fund entity investments and the Black Scholes model for financial derivatives, all classified as Level 3 in the fair value hierarchy, with quantitative sensitivity analysis provided - Fair values of unlisted equity investments and investments in fund entities are estimated using discounted cash flow valuation models, classified as Level 3 in the fair value hierarchy[139](index=139&type=chunk) - Fair values of financial derivatives are estimated using the Black Scholes model valuation technique, classified as Level 3 in the fair value hierarchy[139](index=139&type=chunk) Assets Measured at Fair Value as of June 30, 2025 (S$ thousand) | Asset | Level 3 | Total | | :--- | :--- | :--- | | Equity Investments | 58 | 58 | | Investments in Fund Entities | 1,261 | 1,261 | Liabilities Measured at Fair Value as of June 30, 2025 (S$ thousand) | Liability | Level 3 | Total | | :--- | :--- | :--- | | Financial Derivatives | 1,902 | 1,902 | - During the period, fair value changes for both equity investments and investments in fund entities were recognized as losses, while financial derivatives recognized gains[147](index=147&type=chunk) [26. Authorization for Issue of Interim Condensed Consolidated Financial Statements](index=75&type=section&id=26.%20%E6%8E%88%E6%AC%8A%E5%88%8A%E7%99%BC%E4%B8%AD%E6%9C%9F%E7%B0%A1%E6%98%8E%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8) The interim condensed consolidated financial statements for the six months ended June 30, 2025, were authorized for issue by the Board of Directors on August 14, 2025 - The interim condensed consolidated financial statements were authorized for issue by the Board of Directors on August 14, 2025[149](index=149&type=chunk) [Management Discussion and Analysis](index=76&type=section&id=%E7%AE%A1%E7%90%86%E5%B1%A4%E8%A8%8E%E8%AB%96%E8%88%87%E5%88%86%E6%9E%90) [1. Executive Summary](index=76&type=section&id=1.%20%E5%9F%B7%E8%A1%8C%E6%91%98%E8%A6%81) ZACD Group, a Singapore-based integrated asset management company, focuses on "Investment Management" and "Acquisition and Project Management" as its core businesses, operating 23 investment portfolios across Singapore and Asia Pacific, and providing services to family offices - ZACD Group is a Singapore-based integrated asset management company, focusing on "Investment Management" and "Acquisition and Project Management" as its two core businesses[152](index=152&type=chunk) - The Group operates 23 investment portfolios, covering 22 real estate projects and assets in Singapore, Malaysia, Indonesia, and Australia[152](index=152&type=chunk) - The Group currently provides corporate support and fund management services to family offices with approximately **US$100 million** in assets under management[152](index=152&type=chunk) [2. Financial and Business Review](index=77&type=section&id=2.%20%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7%E5%8F%8A%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7) The Group's net loss for the current period was **S$0.73 million**, an improvement of **48.6%** from the prior period, primarily driven by fair value gains on financial derivatives, despite reduced revenue and other income, as staff costs and income tax expenses also decreased - Net loss for the current period was **S$0.73 million**, an improvement of **48.6%** from the prior period's loss of **S$1.42 million**[155](index=155&type=chunk) - The improvement in net loss is primarily attributed to fair value gains on financial derivatives of approximately **S$0.67 million** (prior period: loss of S$0.29 million), as well as a reduction in staff costs of **S$0.23 million** and income tax expense of **S$0.15 million**[155](index=155&type=chunk) [2.1 Revenue](index=77&type=section&id=2.1%20%E6%94%B6%E5%85%A5) The Group's revenue decreased by **21.0%** year-on-year to **S$1.39 million**, mainly due to lower dividend income, management fees, and performance fees, partially offset by a one-off project tender fee - The Group's revenue decreased by **S$0.37 million** (**21.0%**) from **S$1.76 million** in the prior period to **S$1.39 million** in the current period[156](index=156&type=chunk) - The decrease in revenue was mainly due to a **S$0.13 million** reduction in dividend income, a **S$0.30 million** reduction in management fees, and a **S$0.59 million** reduction in performance fees[156](index=156&type=chunk) - The revenue decrease was partially offset by a one-off project tender fee of approximately **S$0.50 million** and an increase in corporate fees of **S$0.11 million**[156](index=156&type=chunk) - Revenue from special purpose entity investment management increased by **54.5%** to **S$0.17 million**, benefiting from dividend income and performance fees[159](index=159&type=chunk) - Fund management revenue decreased by **24.8%** to **S$1.15 million**, primarily due to a **S$0.78 million** reduction in performance fees, partially offset by a one-off project tender fee of **S$0.50 million**[160](index=160&type=chunk) - Revenue from acquisition and project management services declined by **50.0%** to **S$0.05 million**, as related projects are still under development[161](index=161&type=chunk) - Property management and leasing management service revenue remained stable at **S$0.02 million**, with the Group continuing to evaluate the strategic direction of this business segment[162](index=162&type=chunk) - Financial advisory services have ceased SFC-regulated activities and entered no new advisory mandates, with potential consideration for recommencement in the future[163](index=163&type=chunk) [2.2 Other Income and Gains](index=82&type=section&id=2.2%20%E5%85%B6%E4%BB%96%E6%94%B6%E5%85%A5%E5%8F%8A%E6%94%B6%E7%9B%8A) Other income and gains decreased by **57.4%** year-on-year to **S$0.20 million**, primarily due to a reduction in interest income from bridge loans provided to fund structures - Other income and gains decreased from **S$0.47 million** in the prior period to **S$0.20 million** in the current period, a **57.4%** reduction[164](index=164&type=chunk) - The decrease primarily stemmed from a **S$0.34 million** reduction in interest income generated from bridge loans provided to the Group's managed fund structures, partially offset by a **S$0.06 million** gain on disposal of property, plant and equipment[164](index=164&type=chunk) [2.3 Staff Costs](index=82&type=section&id=2.3%20%E5%93%A1%E5%B7%A5%E6%88%90%E6%9C%AC) Total staff costs decreased by **11.6%** year-on-year to **S$1.75 million**, mainly due to operational streamlining and lower discretionary bonuses, remaining the Group's largest single cost factor - Total staff costs decreased from **S$1.98 million** in the prior period to **S$1.75 million** in the current period, an **11.6%** reduction[165](index=165&type=chunk) - The decrease was primarily attributed to lower discretionary bonuses and operational streamlining aimed at improving productivity[165](index=165&type=chunk) - The total number of employees at the end of the current period was **27** (prior period: 22)[165](index=165&type=chunk) - Staff costs accounted for **59%** of the Group's total expenses (prior period: 62%)[165](index=165&type=chunk) [2.4 Impairment Losses or Reversal of Impairment Losses on Financial Assets](index=82&type=section&id=2.4%20%E9%87%91%E8%9E%8D%E8%B3%87%E7%94%A2%E6%B8%9B%E5%80%BC%E8%99%A7%E6%90%8D%E6%88%96%E6%B8%9B%E5%80%BC%E8%99%A7%E6%90%8D%E6%92%A5%E5%9B%9E) The Group recognized an impairment loss of **S$0.01 million** on trade receivables in the current period, and management will continue to assess the adequacy of expected credit loss provisions - The Group recognized an impairment loss of **S$0.01 million** on trade receivables in the current period (prior period: reversal of impairment loss of S$0.01 million)[166](index=166&type=chunk) [2.5 Other Expenses, Net](index=83&type=section&id=2.5%20%E5%85%B6%E4%BB%96%E9%96%8B%E6%94%AF%EF%BC%8C%E6%B7%A8%E9%A1%8D) Net other expenses remained stable year-on-year at **S$0.71 million** in the current period - Net other expenses remained stable year-on-year at **S$0.71 million** in the current period[167](index=167&type=chunk) [2.6 Interest Expense](index=83&type=section&id=2.6%20%E5%88%A9%E6%81%AF%E9%96%8B%E6%94%AF) Interest expense remained unchanged at **S$0.28 million** in the current period, primarily representing coupon payments due to investor Top Global Limited - Interest expense remained unchanged at **S$0.28 million** in the current period, primarily representing coupon payments due to investor Top Global Limited[168](index=168&type=chunk) [2.7 Fair Value Gains/(Losses) on Financial Derivatives](index=83&type=section&id=2.7%20%E9%87%91%E8%9E%8D%E8%A1%8D%E7%94%9F%E5%B7%A5%E5%85%B7%E4%B9%8B%E5%85%AC%E5%B9%B3%E5%80%BC%E6%94%B6%E7%9B%8A%EF%BC%8F%EF%BC%88%E8%99%A7%E6%90%8D%EF%BC%89) Fair value gains on financial derivatives of **S$0.67 million** were recognized in the current period, a significant improvement from the prior period's loss, mainly due to a lower put option exercise price - Fair value gains on financial derivatives of approximately **S$0.67 million** were recognized in the current period (prior period: loss of approximately S$0.29 million), primarily due to a lower put option exercise price[170](index=170&type=chunk) [2.8 Income Tax Expense](index=83&type=section&id=2.8%20%E6%89%80%E5%BE%97%E7%A8%85%E9%96%8B%E6%94%AF) Singapore income tax of **S$0.02 million** was provided for in the current period at a tax rate of **17%** - Singapore income tax of **S$0.02 million** was provided for in the current period at a tax rate of **17%**[171](index=171&type=chunk) [3. Net Assets](index=84&type=section&id=3.%20%E6%B7%A8%E8%B3%87%E7%94%A2) As of June 30, 2025, the Group's total assets were **S$32.48 million**, net assets were **S$19.52 million**, and net asset value per share was **0.98 Singapore cents**, with the decrease in net assets primarily influenced by fair value losses on investments - As of June 30, 2025, total assets were **S$32.48 million** (2024: S$33.08 million), and net assets were **S$19.52 million** (2024: S$20.43 million)[173](index=173&type=chunk) - Net assets decreased by **S$0.91 million**, primarily due to the impact of fair value losses on investments during the period[173](index=173&type=chunk) - Net asset value per share was **0.98 Singapore cents** (2024: 1.02 Singapore cents)[173](index=173&type=chunk) [4. Liquidity and Capital Resources](index=84&type=section&id=4.%20%E6%B5%81%E5%8B%95%E8%B3%87%E9%87%91%E5%8F%8A%E8%B3%87%E6%9C%AC%E8%B3%87%E6%BA%90) The Group adopts prudent financial management practices, utilizing bank balances, internal operating cash flows, and bank financing to support operations, while actively managing working capital and credit risk - The Group adopts prudent financial management practices to ensure business objectives are met and a robust liquidity position is maintained[174](index=174&type=chunk) - Working capital management includes regular credit assessments, monitoring timely collections, and establishing procedures for doubtful debt recovery[174](index=174&type=chunk) [4.1 Cash and Cash Equivalents](index=84&type=section&id=4.1%20%E7%8F%BE%E9%87%91%E5%8F%8A%E7%8F%BE%E9%87%91%E7%AD%89%E5%83%B9%E7%89%A9) As of June 30, 2025, cash and cash equivalents amounted to **S$4.30 million**, a decrease from **S$5.31 million** as of December 31, 2024, primarily due to investments in development funds - As of June 30, 2025, cash and cash equivalents amounted to **S$4.30 million** (December 31, 2024: S$5.31 million)[175](index=175&type=chunk) - Cash and cash equivalents decreased by **S$1.01 million**, mainly due to investments totaling approximately **S$1.91 million** in ZACD La Ville Development Fund, ZACD Mount Emily Residential Development Fund, and ZACD Media Circle Fund, partially offset by repayment of bridging advances and recovery of debts[176](index=176&type=chunk) [4.2 Bank Borrowings and Gearing Ratio](index=85&type=section&id=4.2%20%E9%8A%80%E8%A1%8C%E5%80%9F%E6%AC%BE%E5%8F%8A%E8%B3%87%E7%94%A2%E8%B2%A0%E5%82%B5%E7%8E%87) As of June 30, 2025, the Group's net cash position was **S$3.99 million**, with a significant reduction in bank borrowings (including lease liabilities) and an improved gearing ratio of **1.6%** Net Cash Position (S$ thousand) | Metric | June 30, 2025 (Unaudited) | December 31, 2024 (Audited) | | :--- | :--- | :--- | | Bank Borrowings and Lease Liabilities | 312 | 862 | | Less: Cash and Cash Equivalents | (4,298) | (5,314) | | **Net Cash** | **3,986** | **4,452** | - The Group's gearing ratio improved from **4.2%** as of December 31, 2024, to **1.6%** in the current period[177](index=177&type=chunk) [5. Other Matters](index=85&type=section&id=5.%20%E5%85%B6%E4%BB%96%E4%BA%8B%E9%A0%85) As of June 30, 2025, the Group had no pledged assets, and financial guarantees, contingent liabilities, and commitments were disclosed in the notes to the financial statements; no dividends were paid or proposed, and no share options were issued during the period - As of June 30, 2025, the Group had no pledged assets[179](index=179&type=chunk) - The Company neither paid nor proposed any dividends for the six months ended June 30, 2025[183](index=183&type=chunk) - As of June 30, 2025, no share options were issued under the share option scheme[184](index=184&type=chunk) - No events with significant impact on the Group's operations and financial performance occurred after the reporting period[185](index=185&type=chunk) [6. Business Outlook](index=87&type=section&id=6.%20%E6%A5%AD%E5%8B%99%E5%89%8D%E6%99%AF) The Group is optimistic about sustained growth in the coming years, anticipating accelerated growth and value realization in the second half of 2025, with slight increases in Singapore's private residential market prices and rents, successful progress in several real estate projects, and plans to launch a new industrial fund - The Group has laid the foundation for sustained growth in the coming years, expecting accelerated growth and value realization in the second half of 2025[187](index=187&type=chunk)[190](index=190&type=chunk) - Singapore's private residential property price index rose by **1.0%** in Q2 2025, and the rental index increased by **0.8%**[187](index=187&type=chunk) - Arina East Residences was soft-launched on May 31, 2025, with an official launch planned for August[188](index=188&type=chunk) - Bloomsbury Residences and Bloomsbury Shoppes were officially launched in April 2025, achieving a sales rate of **46.9%** and an average selling price of **S$2,487** per square foot as of June 30[188](index=188&type=chunk) - The Landmark is expected to obtain its Temporary Occupation Permit in the second half of 2025[188](index=188&type=chunk) - The successful sale of The Sebel West Perth, under ZACD Income Trust, generated significant gains[191](index=191&type=chunk) - In-depth discussions are underway for launching a new industrial fund in Singapore, aiming to acquire industrial land, develop high-specification properties, and sell them for capital gains[190](index=190&type=chunk) [Corporate Governance and Other Information](index=89&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%8F%8A%E5%85%B6%E4%BB%96%E8%B3%87%E6%96%99) [Corporate Governance Practices](index=89&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%B8%B8%E8%A6%8F) The Company has adopted and complied with all applicable code provisions of the Corporate Governance Code set out in Appendix C1 to the GEM Listing Rules - The Company has adopted and complied with all applicable code provisions of the Corporate Governance Code set out in Appendix C1 to the GEM Listing Rules[192](index=192&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=89&type=section&id=%E8%B3%BC%E8%B2%B7%EF%BC%8C%E5%87%BA%E5%94%AE%E6%88%96%E8%B3%96%E5%9B%9E%E6%9C%AC%E5%85%AC%E5%8F%B8%E4%B8%8A%E5%B8%82%E8%AD%89%E5%88%B8) Neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities during the six months ended June 30, 2025 - Neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[193](index=193&type=chunk) [Interests of Compliance Adviser](index=89&type=section&id=%E5%90%88%E8%A6%8F%E9%A1%A7%E5%95%8F%E7%9A%84%E6%AC%8A%E7%9B%8A) The Group's compliance adviser, Ascent Partners Corporate Finance Limited, and its directors, employees, or close associates, have no interests in the securities of the Company or any member of the Group that are required to be disclosed to the Company under Rule 6A.32 of the GEM Listing Rules - The compliance adviser and its associates have no interests in the securities of the Company or any member of the Group that are required to be disclosed to the Company[194](index=194&type=chunk) [Audit Committee](index=89&type=section&id=%E5%AF%A9%E6%A0%B8%E5%A7%94%E5%93%A1%E6%9C%83) The Audit Committee, composed of three independent non-executive directors, advises on and oversees external auditors, financial statements, internal controls, risk management, and continuing connected transactions, having reviewed the interim results for the current period - The Audit Committee comprises three independent non-executive directors, with Mr. Lau Kin Chung as Chairman[195](index=195&type=chunk) - Its primary responsibilities include advising on the appointment and removal of external auditors, reviewing and overseeing financial statements, monitoring internal controls and risk management procedures, and overseeing continuing connected transactions[195](index=195&type=chunk) - The Audit Committee has reviewed the Group's interim results for the six months ended June 30, 2025[195](index=195&type=chunk) [Publication of Interim Report on HKEX and Company Website](index=90&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%E5%A0%B1%E5%91%8A) The interim report for the six months ended June 30, 2025, will be dispatched to shareholders in due course and will be available on the Company's website and the designated HKEX website - The interim report will be dispatched to shareholders and will be available on the Company's website (www.zacdgroup.com) and the designated HKEX website (www.hkexnews.hk)[197](index=197&type=chunk)

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其 準確性或完整性亦不發表任何聲明，並明確表示概不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。 TSIT WING INTERNATIONAL HOLDINGS LIMITED 捷榮國際控股有限公 司* （根據百慕達法例註冊成立的有限公司） （股份代號：2119） 截至2025年6月30日止六個月的 中期業績公告 財務摘要 * 僅供識別 – 1 – • 截至2025年6月30日止六個月的收入為380.4百萬港元，較2024年同期的349.4百萬 港元增加8.9%。 • 截至2025年6月30日止六個月的毛利為115.9百萬港元，較2024年同期的124.8百萬 港元減少7.1%。 • 毛利率由截至2024年6月30日止六個月的35.7%減少至截至2025年6月30日止六個 月的30.5%。 • 截至2025年6月30日止六個月的溢利為24.9百萬港元，較2024年同期的36.1百萬港 元減少31.0%。 • 純利率由截至2024年6月30日止六個月的10.3%減少至截至2025年6月30日止六個 月 ...

[Company Announcement](index=1&type=section&id=Company%20Announcement) [Announcement Summary](index=1&type=section&id=Announcement%20Summary) SouthGobi Resources Ltd. announced its unaudited financial and operating results for the three and six months ended June 30, 2025, with detailed reports available on SEDAR+ and HKEXnews websites - SouthGobi Resources Ltd. announced its unaudited financial and operating results for the three and six months ended June 30, 2025, on August 14, 2025[2](index=2&type=chunk) [Board of Directors](index=1&type=section&id=Board%20of%20Directors) As of the announcement date, the company's board of directors comprises executive, independent non-executive, and non-executive directors, with Yingbin He serving as Lead Director - As of the announcement date, the board members include Mr. Ruibin Xu, Ms. Chonglin Zhu, Mr. Chen Shen (Executive Directors), Mr. Yingbin He, Ms. Jinlan Quan, Mr. Fenqiang Cai (Independent Non-Executive Directors), and Mr. Zhu Gao, Mr. Zaixiang Wen (Non-Executive Directors)[3](index=3&type=chunk) [Significant Events and Highlights](index=2&type=section&id=Significant%20Events%20and%20Highlights) [Operating Performance](index=2&type=section&id=Operating%20Performance) Since 2024, the company has expanded its mining operations, employing various coal processing methods to enhance coal quality and output, facilitating exports to China; however, a downturn in the Chinese coal market led to a decrease in average realized prices and a shift in product mix towards lower-priced coal products - The company expanded its mining operations since 2024, employing various methods such as screening, wet washing, and dry coal processing to improve coal quality and output, facilitating exports to China[6](index=6&type=chunk) - Sales volume reached **3.0 million tonnes** in Q2 2025, a significant increase from **1.2 million tonnes** in Q2 2024[6](index=6&type=chunk) | Metric | 2025 Q2 | 2024 Q2 | Change | | :--- | :--- | :--- | :--- | | Sales Volume (million tonnes) | 3.0 | 1.2 | +150% | | Average Realized Price (USD/tonne) | 52.6 | 77.6 | -32.2% | [Mongolian Government Strategic Mineral Deposit Designation](index=3&type=section&id=Mongolian%20Government%20Strategic%20Mineral%20Deposit%20Designation) The Mongolian government designated certain company mineral deposits as strategically important under the State Wealth Fund Law and initiated preliminary discussions with the company's subsidiary SGS to determine Mongolia's ownership or royalty interests in SGS - The Mongolian government designated four mining licenses related to the company's Ovoot Tolgoi and Soumber deposits as strategically important under the State Wealth Fund Law[7](index=7&type=chunk)[8](index=8&type=chunk) - SGS received a letter from the Mongolian government's plenipotentiary representative on April 2, 2025, inviting discussions on the Mongolian government's ownership interest in SGS, with preliminary discussions commencing on April 24, 2025[7](index=7&type=chunk)[9](index=9&type=chunk) [Financial Performance](index=3&type=section&id=Financial%20Performance) In Q2 2025, the company reported an operating loss of $14.3 million, compared to an operating profit of $15.0 million in the prior year, primarily due to lower average realized prices, a shift in product mix towards higher-cost processed coal, and an impairment loss of $12.3 million on coal inventory | Metric | 2025 Q2 | 2024 Q2 | Change | | :--- | :--- | :--- | :--- | | Operating Profit/(Loss) (million USD) | (14.3) | 15.0 | Shift from profit to loss | - The decline in financial performance was primarily due to lower average realized prices, a shift in product mix (selling more higher-cost processed coal), and an impairment loss of **$12.3 million** on coal inventory[9](index=9&type=chunk) [Mongolian Tax Authority Additional Taxes and Penalties](index=4&type=section&id=Mongolian%20Tax%20Authority%20Additional%20Taxes%20and%20Penalties) The Mongolian Tax Authority's initial tax penalty of approximately $75 million against SGS was ultimately reduced to about $26.5 million by the Tax Dispute Resolution Council after multiple appeals and reassessments; an appeal by tax officials to overturn this decision was rejected by the Administrative Court, making the ruling final, and the company has paid $17.3 million, with the remainder expected to be paid from operating cash - The Mongolian Tax Authority initially imposed a tax penalty of approximately **$75 million** on SGS, which was later increased to approximately **$80 million** after reassessment[10](index=10&type=chunk)[11](index=11&type=chunk) - Following a TDRC ruling, the tax penalty amount was ultimately reduced to approximately **$26.5 million**[12](index=12&type=chunk) - The Mongolian Tax Authority's appeal to overturn the TDRC ruling was rejected by the first-instance Administrative Court and the Appeals Court, making the decision final; the company has paid **$17.3 million** and expects to pay the remaining amount from operating cash[14](index=14&type=chunk)[15](index=15&type=chunk) [March 2025 Deferral Agreement](index=6&type=section&id=2025%20March%20Deferral%20Agreement) The company entered into a March 2025 deferral agreement with JD Zhixing Fund L.P. (JDZF) to postpone payments totaling approximately $133.7 million until August 31, 2026, subject to deferral fees; the agreement, approved by shareholders, requires monthly financial updates to JDZF and negotiation of repayment amounts - The company reached an agreement with JDZF to defer approximately **$133.7 million** in cash and in-kind interest, management fees, and related deferral fees until August 31, 2026[16](index=16&type=chunk)[17](index=17&type=chunk) - The deferred payments are subject to deferral fees at an annual interest rate of **6.4%** (related to convertible bonds) and **1.5%** (related to cooperation agreements)[17](index=17&type=chunk) - The agreement requires the company to provide monthly financial updates to JDZF and negotiate repayment amounts, also stipulating that changes in senior management require JDZF's written consent[19](index=19&type=chunk)[57](index=57&type=chunk) [Going Concern Considerations](index=7&type=section&id=Going%20Concern%20Considerations) The company faces adverse conditions and significant uncertainties, including asset and working capital deficits, which cast substantial doubt on its ability to continue as a going concern - The company faces adverse conditions and significant uncertainties, including asset and working capital deficits, which cast substantial doubt on its ability to continue as a going concern[19](index=19&type=chunk) [Operating Data and Financial Performance Review](index=8&type=section&id=Operating%20Data%20and%20Financial%20Performance%20Review) [Operating Data Summary](index=8&type=section&id=Operating%20Data%20Summary) In Q2 and H1 2025, the company experienced significant growth in coal sales volume, but average realized prices declined sharply due to a downturn in the Chinese coal market, with the product mix shifting towards lower-priced processed coal, leading to an increase in unit cost of sales in H1 | Metric | 2025 Q2 | 2024 Q2 | YoY Change | 2025 H1 | 2024 H1 | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Coal Sales Volume (million tonnes)** | | | | | | | | Premium Semi-Soft Coking Coal | 0.17 | 0.29 | -41.4% | 0.21 | 0.65 | -67.7% | | Standard Semi-Soft Coking Coal/Premium Thermal Coal | 1.65 | 0.28 | +489.3% | 2.60 | 0.56 | +364.3% | | Standard Thermal Coal | 0.09 | 0.12 | -25.0% | 0.23 | 0.24 | -4.2% | | Processed Coal | 1.05 | 0.51 | +105.9% | 1.98 | 0.80 | +147.5% | | **Total Sales Volume (million tonnes)** | **2.96** | **1.20** | **+146.7%** | **5.02** | **2.25** | **+123.1%** | | **Average Realized Price (USD/tonne)** | | | | | | | | Premium Semi-Soft Coking Coal | 59.84 | 102.61 | -41.7% | 65.57 | 107.22 | -38.8% | | Standard Semi-Soft Coking Coal/Premium Thermal Coal | 60.07 | 77.04 | -22.1% | 63.88 | 76.56 | -16.6% | | Standard Thermal Coal | 17.89 | 36.10 | -50.4% | 28.54 | 41.93 | -32.0% | | Processed Coal | 42.46 | 73.04 | -41.9% | 46.28 | 67.09 | -31.0% | | **Total Average Realized Price (USD/tonne)** | **52.55** | **77.55** | **-32.2%** | **55.41** | **78.47** | **-29.4%** | | **Cost of Sales of Products Sold (USD/tonne)** | 53.87 | 61.32 | -12.1% | 58.39 | 52.94 | +10.3% | [For the Three Months Ended June 30, 2025](index=9&type=section&id=For%20the%20Three%20Months%20Ended%20June%2030%2C%202025) In Q2 2025, the average realized price was $52.6/tonne, a 32.2% year-over-year decrease, primarily due to the downturn in the Chinese coal market and a shift in product mix towards lower-priced coal products, while the unit cost of sales was $53.9/tonne, a 12.1% year-over-year decrease, mainly due to increased raw coal sales - The average realized price in Q2 2025 was **$52.6/tonne**, a decrease from **$77.6/tonne** in Q2 2024, primarily due to the downturn in the Chinese coal market and changes in product mix[22](index=22&type=chunk) - The unit cost of sales for products sold in Q2 2025 was **$53.9/tonne**, a decrease from **$61.3/tonne** in Q2 2024, mainly due to changes in product mix and increased raw coal sales[22](index=22&type=chunk) [For the Six Months Ended June 30, 2025](index=9&type=section&id=For%20the%20Six%20Months%20Ended%20June%2030%2C%202025) In H1 2025, sales volume reached 5.0 million tonnes, a significant year-over-year increase, but the average realized price was $55.4/tonne, a 29.4% year-over-year decrease, also affected by market downturns and product mix adjustments, while the unit cost of sales was $58.4/tonne, a 10.3% year-over-year increase, primarily due to business expansion into higher-cost processed coal categories - Sales volume in H1 2025 was **5.0 million tonnes**, a significant increase from **2.3 million tonnes** in H1 2024[24](index=24&type=chunk) - The average realized price in H1 2025 was **$55.4/tonne**, a decrease from **$78.5/tonne** in H1 2024, primarily due to the downturn in the Chinese coal market and changes in product mix[24](index=24&type=chunk) - The unit cost of sales for products sold in H1 2025 was **$58.4/tonne**, an increase from **$52.9/tonne** in H1 2024, mainly due to business expansion into higher-cost processed coal categories[24](index=24&type=chunk) [Quarterly Operating Data Summary](index=15&type=section&id=Quarterly%20Operating%20Data%20Summary) The report provides detailed quarterly operating data from 2023 to 2025, including sales volume, average realized price, raw coal production, cost of sales, and strip ratio for various coal types, illustrating trends in sales fluctuations and market-influenced pricing | Metric | 2025 Q2 | 2025 Q1 | 2024 Q4 | 2024 Q3 | 2024 Q2 | 2024 Q1 | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Total Sales Volume (million tonnes)** | 2.96 | 2.06 | 2.66 | 2.11 | 1.20 | 1.05 | | **Total Average Realized Price (USD/tonne)** | 52.55 | 59.51 | 65.72 | 67.77 | 77.55 | 79.52 | | **Raw Coal Production (million tonnes)** | 3.91 | 3.92 | 4.19 | 2.75 | 2.01 | 1.25 | | **Cost of Sales of Products Sold (USD/tonne)** | 53.87 | 64.90 | 48.92 | 52.77 | 61.32 | 43.36 | [Financial Performance Summary](index=10&type=section&id=Financial%20Performance%20Summary) In Q2 and H1 2025, the company's operating performance shifted from profit to loss, primarily due to declining average realized prices, changes in product mix, impairment losses on coal inventory, and a significant increase in cost of sales; while revenue grew, it could not offset rising costs and adverse market factors | Metric (thousand USD) | 2025 Q2 | 2024 Q2 | YoY Change | 2025 H1 | 2024 H1 | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | 155,289 | 92,821 | +67.3% | 278,156 | 174,990 | +58.9% | | Cost of Sales | (159,452) | (73,582) | +116.7% | (293,141) | (119,115) | +146.1% | | Gross Profit/(Loss) | (4,163) | 19,239 | Shift from profit to loss | (14,985) | 55,875 | Shift from profit to loss | | Operating Profit/(Loss) | (14,326) | 15,045 | Shift from profit to loss | (30,000) | 47,193 | Shift from profit to loss | | Net Profit/(Loss) Attributable to Owners of the Company | (22,806) | (2,085) | Loss widened | (49,011) | 10,167 | Shift from profit to loss | | Basic and Diluted Earnings/(Loss) Per Share (USD) | (0.077) | (0.007) | Loss widened | (0.165) | 0.034 | Shift from profit to loss | [For the Three Months Ended June 30, 2025](index=11&type=section&id=For%20the%20Three%20Months%20Ended%20June%2030%2C%202025_Financial) In Q2 2025, the company reported an operating loss of $14.3 million, with revenue increasing to $155.3 million, but cost of sales significantly rising to $159.5 million due to higher sales volume, sales of high-cost processed coal, and increased transportation costs; other operating expenses also increased significantly due to a $12.3 million impairment loss on coal inventory - In Q2 2025, operating activities resulted in a **$14.3 million loss**, compared to a **$15.0 million profit** in Q2 2024, primarily due to lower average realized prices, changes in product mix, and a **$12.3 million** impairment loss on coal inventory[28](index=28&type=chunk) - Revenue increased to **$155.3 million** (Q2 2024: $92.8 million), while cost of sales increased to **$159.5 million** (Q2 2024: $73.6 million), mainly due to higher sales volume, sales of high-cost processed coal, and increased transportation costs[28](index=28&type=chunk) - Other operating expenses increased to **$7.0 million** (Q2 2024: $1.2 million), primarily due to higher administrative fees and a **$12.3 million** impairment loss on coal inventory[30](index=30&type=chunk) [For the Six Months Ended June 30, 2025](index=13&type=section&id=For%20the%20Six%20Months%20Ended%20June%2030%2C%202025_Financial) In H1 2025, the company incurred an operating loss of $30.0 million, with revenue increasing to $278.2 million, and cost of sales rising to $293.1 million, mainly due to increased sales volume and expansion into higher-cost processed coal categories; other operating expenses also increased due to the impairment loss on coal inventory - In H1 2025, operating activities resulted in a **$30.0 million loss**, compared to a **$47.2 million profit** in H1 2024, primarily due to lower average realized prices, changes in product mix, and a **$12.3 million** impairment loss on coal inventory[33](index=33&type=chunk) - Revenue increased to **$278.2 million** (H1 2024: $175.0 million), while cost of sales increased to **$293.1 million** (H1 2024: $119.1 million), mainly due to higher sales volume and business expansion into higher-cost processed coal categories[33](index=33&type=chunk) - Other operating expenses increased to **$8.6 million** (H1 2024: $2.2 million), primarily due to higher administrative fees and a **$12.3 million** impairment loss on coal inventory[35](index=35&type=chunk) [Quarterly Financial Performance Summary](index=16&type=section&id=Quarterly%20Financial%20Performance%20Summary) The report provides detailed quarterly financial performance from 2023 to 2025, including revenue, cost of sales, gross profit, operating profit/loss, and net profit/loss, reflecting quarterly fluctuations in performance and the impact of market environment changes | Metric (thousand USD) | 2025 Q2 | 2025 Q1 | 2024 Q4 | 2024 Q3 | 2024 Q2 | 2024 Q1 | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | 155,289 | 122,867 | 174,640 | 143,748 | 92,821 | 82,169 | | Cost of Sales | (159,452) | (133,689) | (130,119) | (111,354) | (73,582) | (45,533) | | Gross Profit/(Loss) | (4,163) | (10,822) | 44,521 | 32,394 | 19,239 | 36,636 | | Operating Profit/(Loss) | (14,326) | (15,674) | 79,052 | 27,697 | 15,045 | 32,148 | | Net Profit/(Loss) | (22,806) | (26,205) | 72,291 | 10,039 | (2,085) | 12,252 | | Basic Earnings/(Loss) Per Share (USD) | (0.077) | (0.088) | 0.244 | 0.034 | (0.007) | 0.041 | [Liquidity and Capital Resources](index=17&type=section&id=Liquidity%20and%20Capital%20Resources) [Liquidity and Capital Management](index=17&type=section&id=Liquidity%20and%20Capital%20Management) The company has established planning, budgeting, and forecasting procedures to determine the funding required for ongoing operations and expansion plans, while closely monitoring factors affecting liquidity - The company has established planning, budgeting, and forecasting procedures to determine the funding required for ongoing operations and expansion plans[42](index=42&type=chunk) [Mongolian Tax Authority Additional Taxes and Penalties_Liquidity](index=17&type=section&id=Mongolian%20Tax%20Authority%20Additional%20Taxes%20and%20Penalties_Liquidity) The Mongolian Tax Authority's tax penalty against SGS was ultimately determined to be $26.5 million after multiple appeals and court rulings; the company has paid $17.3 million, with the remaining amount expected to be paid through operating cash flow, and management will continue to assess the impact of subsequent events on the tax amount - The Mongolian Tax Authority's tax penalty against SGS was finally determined to be **$26.5 million**, of which the company has paid **$17.3 million**[45](index=45&type=chunk)[47](index=47&type=chunk) - The Mongolian Tax Authority's appeal to overturn the TDRC ruling was rejected by the first-instance Administrative Court and the Appeals Court, making the decision final[46](index=46&type=chunk) - The company expects to pay the outstanding taxes and tax penalties from cash generated by operating activities, and management will continue to assess the impact of any subsequent events on the tax amount[47](index=47&type=chunk) [Going Concern Considerations](index=19&type=section&id=Going%20Concern%20Considerations) The company faces an asset deficit of $108.4 million and a working capital deficit of $148.0 million, raising significant doubt about its ability to continue as a going concern; to address liquidity issues, the company has implemented measures including deferral agreements, repayment negotiations with suppliers, and access to up to $127 million in financial support from a major shareholder's affiliate, with the Board believing sufficient financial resources exist for continued operations | Metric (thousand USD) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Asset Deficit | (108,406) | (49,843) | | Working Capital Deficit | (147,962) | (228,134) | - Significant uncertainty exists regarding the company's ability to continue as a going concern, but management has developed cash flow forecasts and implemented measures including deferral agreements, repayment negotiations with suppliers, and access to up to **$127 million** in financial support from a major shareholder's affiliate[48](index=48&type=chunk)[50](index=50&type=chunk) - The Board believes the company has sufficient financial resources to continue operations, but its going concern status depends on the timely utilization of financial support from the major shareholder's affiliate[50](index=50&type=chunk) [Convertible Bonds](index=21&type=section&id=Convertible%20Bonds) In November 2009, the company entered into a financing agreement with CIC, issuing $500 million in secured convertible bonds with an 8.0% interest rate and a 30-year term; in March 2010, the company exercised its conversion right, converting $250 million of bonds into approximately 21.5 million shares - In November 2009, the company issued **$500 million** in secured convertible bonds to CIC, with an **8.0%** interest rate and a **30-year** term[53](index=53&type=chunk) - In March 2010, the company converted **$250 million** of convertible bonds into approximately **21.5 million** shares[53](index=53&type=chunk) [Deferral Agreement](index=21&type=section&id=Deferral%20Agreement) The company signed a March 2025 deferral agreement with JDZF, postponing approximately $133.7 million in payments until August 31, 2026, subject to deferral fees; the agreement, approved by shareholders, requires monthly financial updates to JDZF, negotiation of repayment amounts, and JDZF's written consent for senior management changes - The company signed a March 2025 deferral agreement with JDZF, deferring approximately **$133.7 million** in payments until August 31, 2026[54](index=54&type=chunk)[55](index=55&type=chunk) - The deferred payments are subject to deferral fees at an annual interest rate of **6.4%** (related to convertible bonds) and **1.5%** (related to cooperation agreements)[55](index=55&type=chunk)[57](index=57&type=chunk) - The agreement requires the company to provide monthly financial updates to JDZF and negotiate repayment amounts, and changes in senior management require JDZF's written consent[57](index=57&type=chunk) [Ovoot Tolgoi Coal Mine Impairment Analysis](index=22&type=section&id=Ovoot%20Tolgoi%20Coal%20Mine%20Impairment%20Analysis) As of June 30, 2025, the Ovoot Tolgoi coal mine showed impairment indicators, primarily due to uncertainties in future Chinese coal prices; however, no impairment of non-financial assets was recognized for the period as the recoverable amount exceeded the carrying value - The Ovoot Tolgoi coal mine showed impairment indicators, primarily due to uncertainties in future Chinese coal prices[56](index=56&type=chunk) - No impairment of non-financial assets was recognized for the six months ended June 30, 2025, as the recoverable amount exceeded the carrying value[56](index=56&type=chunk) [Regulatory Matters and Contingencies](index=23&type=section&id=Regulatory%20Matters%20and%20Contingencies) [Litigation](index=23&type=section&id=Litigation) The company faces a class action lawsuit stemming from restated financial statements and has reached a conditional settlement of CAD 6.8 million with the plaintiffs, with costs covered by the company's insurer, pending approval by the Ontario Superior Court - The company faces a class action lawsuit due to restated financial statements and has reached a conditional settlement of **CAD 6.8 million** with the plaintiffs[59](index=59&type=chunk) - The settlement costs are covered by the company's insurer and are pending approval by the Ontario Superior Court[59](index=59&type=chunk)[60](index=60&type=chunk) [Special Needs Areas in South Gobi Province](index=24&type=section&id=Special%20Needs%20Areas%20in%20South%20Gobi%20Province) The company's Soumber mining licenses were previously included in a special needs area prohibiting mining; following negotiations and court rulings, two license areas no longer overlap with special needs areas, and the local government's appeal to re-designate the license areas as protected zones was rejected, making the ruling final - Mining licenses for the Soumber deposit were previously included in a special needs area, prohibiting mining[62](index=62&type=chunk) - Following negotiations and court rulings, two mining license areas no longer overlap with special needs areas[63](index=63&type=chunk) - The local government's appeal to re-designate the license areas as protected zones was rejected, making the ruling final[64](index=64&type=chunk) [Tax Law](index=25&type=section&id=Tax%20Law) Mongolian tax laws are subject to frequent interpretation and changes, potentially exposing the company to additional taxes, penalties, and interest risks; despite management's belief in its appropriate interpretations, tax authorities may still raise objections, and the company has paid $17.3 million in tax penalties and continues to assess the impact of subsequent events - Mongolian tax, currency, and customs laws are frequently subject to differing interpretations and changes, potentially leading to significant additional taxes, penalties, and interest being levied against the company[65](index=65&type=chunk) - The Mongolian Tax Authority's appeal to overturn the TDRC's reduction of SGS's tax penalty was rejected by the Administrative Court, making the ruling final[67](index=67&type=chunk) - The company has paid a total of **$17.3 million** to the Mongolian Tax Authority for the aforementioned tax penalties, and management will continue to assess the impact of any subsequent events on the tax amount[68](index=68&type=chunk) [Transportation Infrastructure](index=26&type=section&id=Transportation%20Infrastructure) The company, through its Mongolian subsidiary SGS, holds a 40% indirect equity interest in RDCC LLC, which owns a 30-year patent for the road from the Ovoot Tolgoi coal mine to the Shivee Khuren border crossing; in H1 2025, RDCC LLC recognized $6.5 million in toll revenue, and most of the company's mobile equipment is pledged as collateral for convertible bonds - The company, through SGS, holds a **40%** indirect equity interest in RDCC LLC, which owns a **30-year** patent for the road from the Ovoot Tolgoi coal mine to the Shivee Khuren border crossing[69](index=69&type=chunk) - In H1 2025, RDCC LLC recognized **$6.5 million** in toll revenue (2024: $6.3 million)[70](index=70&type=chunk) - As of June 30, 2025, most of the company's mobile equipment and other operating equipment with a carrying value of **$12.6 million** is pledged as collateral for convertible bonds[71](index=71&type=chunk) [Corporate Governance and Other Disclosures](index=27&type=section&id=Corporate%20Governance%20and%20Other%20Disclosures) [Purchase, Sale or Redemption of Listed Securities](index=27&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20Listed%20Securities) For the six months ended June 30, 2025, neither the company nor its subsidiaries purchased, sold, or redeemed any listed securities, and the company held no treasury shares - For the six months ended June 30, 2025, neither the company nor its subsidiaries purchased, sold, or redeemed any listed securities[72](index=72&type=chunk) - As of June 30, 2025, the company held no treasury shares[72](index=72&type=chunk) [Compliance with Corporate Governance Requirements](index=27&type=section&id=Compliance%20with%20Corporate%20Governance%20Requirements) For the six months ended June 30, 2025, the company generally complied with the Corporate Governance Code, with three exceptions: the Board having no chairman (duties performed by the independent Lead Director), insufficient frequency of meetings between the chairman and non-executive directors, and the independent Lead Director chairing the annual general meeting - The company generally complied with the Corporate Governance Code, with three exceptions, including the Board having no chairman (duties performed by the independent Lead Director), insufficient frequency of meetings between the chairman and non-executive directors, and the independent Lead Director chairing the annual general meeting[73](index=73&type=chunk) [Directors' Securities Transactions](index=28&type=section&id=Directors'%20Securities%20Transactions) The company has adopted a directors' securities dealing policy with terms no less exacting than the Model Code, and all directors confirmed compliance; directors engaging in transactions involving company securities or related financial instruments must submit insider reports and disclose to the HKEX - The company has adopted a directors' securities dealing policy, and all directors confirmed compliance with the policy and the Model Code[74](index=74&type=chunk) - Directors engaging in transactions involving company securities or related financial instruments must submit insider reports and disclose to the HKEX[74](index=74&type=chunk) [Material Investments](index=28&type=section&id=Material%20Investments) As of June 30, 2025, the company had no material investments other than investments in joint ventures and associates - As of June 30, 2025, the company had no material investments other than investments in joint ventures and associates[76](index=76&type=chunk) [Material Acquisitions and Disposals of Subsidiaries, Joint Ventures and Associates](index=28&type=section&id=Material%20Acquisitions%20and%20Disposals%20of%20Subsidiaries%2C%20Joint%20Ventures%20and%20Associates) For the six months ended June 30, 2025, the company had no material acquisitions or disposals of subsidiaries, joint ventures, or associates - For the six months ended June 30, 2025, the company had no material acquisitions or disposals of subsidiaries, joint ventures, or associates[77](index=77&type=chunk) [Future Plans for Material Investments or Capital Assets](index=28&type=section&id=Future%20Plans%20for%20Material%20Investments%20or%20Capital%20Assets) As of June 30, 2025, the company had no specific plans for material investments or capital assets - As of June 30, 2025, the company had no specific plans for material investments or capital assets[78](index=78&type=chunk) [Outlook](index=28&type=section&id=Outlook) [Market Outlook](index=28&type=section&id=Market%20Outlook) Despite global geopolitical challenges and a downturn in the Chinese real estate market impacting coking coal demand, the company remains cautiously optimistic about the Chinese coal market, anticipating continued reliance on coal and supply constraints from environmental and safety regulations, which may lead to price volatility; the company will focus on expanding market reach and customer base to improve profit margins - Global geopolitical dynamics and US-China trade tensions may lead to a shift in China's coal import sources, potentially benefiting Mongolia through strengthened Sino-Mongolian government cooperation and improved infrastructure[79](index=79&type=chunk)[80](index=80&type=chunk) - Challenges in China's real estate market and infrastructure investment are leading to a decline in steel demand and coking coal demand[80](index=80&type=chunk) - The company remains cautiously optimistic about the Chinese coal market, expecting coal to remain China's primary energy source, with environmental and safety production requirements limiting supply, potentially leading to price volatility[80](index=80&type=chunk) [Medium-Term Objectives](index=29&type=section&id=Medium-Term%20Objectives) In the medium term, the company will continue to expand mining operations and coal processing capacity, optimize its product portfolio through improved mining, processing plants, and blended coal trading, broaden its market reach and customer base via sales networks, logistics capabilities, and market pricing, and optimize its operating cost structure, all while prioritizing safety and social responsibility - The company will continue to expand mining operations and coal processing capacity to capture market share[81](index=81&type=chunk) - Medium-term objectives include optimizing the product portfolio (improving mining, utilizing processing plants, trading blended coal), expanding market reach and customer base (sales network, logistics capabilities, market pricing), and optimizing the operating cost structure, while prioritizing safety and social responsibility[81](index=81&type=chunk)[82](index=82&type=chunk) [Long-Term Competitive Advantages](index=30&type=section&id=Long-Term%20Competitive%20Advantages) The company's long-term competitive advantages include increased production and optimized cost structure, safe and socially responsible operations, a strategic geographical location (Ovoot Tolgoi coal mine near the Chinese market), a substantial reserve base, growth potential (Soumber and Zag Suuj deposits), and its role as a bridge between China and Mongolia - Long-term competitive advantages include increased production and optimized cost structure, safe and socially responsible operations, strategic location (Ovoot Tolgoi coal mine close to the Chinese market), a substantial reserve base (at least **82.3 million tonnes**), several growth potentials (Soumber and Zag Suuj deposits), and its position as a bridge between China and Mongolia[84](index=84&type=chunk) [Non-IFRS Financial Measures](index=30&type=section&id=Non-IFRS%20Financial%20Measures) [Cash Cost](index=30&type=section&id=Cash%20Cost) The company uses cash cost as a non-IFRS financial measure to reflect cash production and related cash costs incurred to bring inventory to its present location and condition, excluding idle mine asset costs and non-cash expenses, for internal monitoring and providing investors with operating cash cost information - Cash cost is a non-IFRS financial measure used by the company to monitor internal operating cash costs[83](index=83&type=chunk) - Cash cost includes all production costs (direct and indirect) but excludes idle mine asset costs and non-cash expenses (such as share-based compensation, coal inventory impairment, depreciation, and depletion)[83](index=83&type=chunk) [Financial Data Summary](index=31&type=section&id=Financial%20Data%20Summary) [Comprehensive Income Data Summary](index=31&type=section&id=Comprehensive%20Income%20Data%20Summary) In Q2 and H1 2025, the company reported net losses and comprehensive losses, primarily due to a significant increase in cost of sales, a shift from operating profit to loss, and negative impacts from exchange differences | Metric (thousand USD) | 2025 Q2 | 2024 Q2 | 2025 H1 | 2024 H1 | | :--- | :--- | :--- | :--- | :--- | | Revenue | 155,289 | 92,821 | 278,156 | 174,990 | | Cost of Sales | (159,452) | (73,582) | (293,141) | (119,115) | | Gross Profit/(Loss) | (4,163) | 19,239 | (14,985) | 55,875 | | Operating Profit/(Loss) | (14,326) | 15,045 | (30,000) | 47,193 | | Net Profit/(Loss) | (22,806) | (2,085) | (49,011) | 10,167 | | Other Comprehensive Income/(Loss) (Exchange Differences) | (5,324) | (196) | (9,552) | 2,006 | | Net Comprehensive Income/(Loss) | (28,130) | (2,281) | (58,563) | 12,173 | | Basic and Diluted Earnings/(Loss) Per Share (USD) | (0.077) | (0.007) | (0.165) | 0.034 | [Financial Position Data Summary](index=32&type=section&id=Financial%20Position%20Data%20Summary) As of June 30, 2025, the company's total assets were $410.7 million, and total liabilities were $519.1 million, resulting in an asset deficit of $108.4 million; total current liabilities were $279.9 million, leading to a working capital deficit of $148.0 million, primarily influenced by trade and other payables and additional tax penalties | Metric (thousand USD) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Total Current Assets | 131,994 | 153,679 | | Total Non-Current Assets | 278,689 | 276,174 | | **Total Assets** | **410,683** | **429,853** | | **Liabilities** | | | | Total Current Liabilities | 279,956 | 381,813 | | Total Non-Current Liabilities | 239,133 | 97,883 | | **Total Liabilities** | **519,089** | **479,696** | | **Equity** | | | | Total Asset Deficit | (108,406) | (49,843) | | **Net Current Liabilities (Working Capital Deficit)** | **(147,962)** | **(228,134)** | [Cash Flow Data Summary](index=34&type=section&id=Cash%20Flow%20Data%20Summary) In H1 2025, net cash flow from operating activities was $34.57 million, net cash outflow from investing activities was $39.349 million, and net cash outflow from financing activities was $0.374 million, resulting in a decrease in cash and cash equivalents to $2.614 million at period-end | Metric (thousand USD) | 2025 H1 | 2024 H1 | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 34,570 | 32,355 | | Net Cash Flow Used in Investing Activities | (39,349) | (64,294) | | Net Cash Flow Used in Financing Activities | (374) | (3,291) | | Net Effect of Exchange Rate Changes | (823) | (105) | | Decrease in Cash and Cash Equivalents | (5,976) | (35,335) | | Cash and Cash Equivalents at End of Period | 2,614 | 12,658 | [Selected Information from Notes to Condensed Consolidated Financial Statements](index=36&type=section&id=Selected%20Information%20from%20Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) [Basis of Preparation](index=36&type=section&id=Basis%20of%20Preparation) The condensed consolidated interim financial statements are prepared on a going concern basis, despite the company facing an asset deficit of $108.4 million and a working capital deficit of $148.0 million, which raises significant doubt about its ability to continue as a going concern; management has developed plans, including deferral agreements and financial support from a major shareholder, to ensure liquidity for the next 12 months - The condensed consolidated interim financial statements are prepared on a going concern basis, but the company faces an asset deficit of **$108.4 million** and a working capital deficit of **$148.0 million**, raising significant doubt about its ability to continue as a going concern[92](index=92&type=chunk) - The company has implemented measures, including deferral agreements, repayment negotiations with suppliers, and access to up to **$127 million** in financial support from a major shareholder's affiliate, to ensure liquidity for the next 12 months[94](index=94&type=chunk) [Company Overview and Going Concern](index=36&type=section&id=Company%20Overview%20and%20Going%20Concern) The company faces severe asset and working capital deficits, creating significant uncertainty about its ability to continue as a going concern; management has developed cash flow forecasts and implemented various measures, including deferral agreements and financial support from a major shareholder, to address liquidity challenges and considers the going concern assumption appropriate | Metric (thousand USD) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Asset Deficit | (108,406) | (49,843) | | Working Capital Deficit | (147,962) | (228,134) | - Significant uncertainty exists regarding the company's ability to continue as a going concern, but management has developed cash flow forecasts and implemented measures, including deferral agreements, repayment negotiations with suppliers, and access to up to **$127 million** in financial support from a major shareholder's affiliate[94](index=94&type=chunk) - The Board believes the company has sufficient financial resources to continue operations, but its going concern status depends on the timely utilization of financial support from the major shareholder's affiliate[94](index=94&type=chunk) [Compliance Statement](index=37&type=section&id=Compliance%20Statement) The condensed consolidated interim financial statements are prepared in accordance with International Accounting Standard 34, comply with IFRS accounting policies and interpretations, and were approved for issue by the Board of Directors on August 14, 2025 - The condensed consolidated interim financial statements are prepared in accordance with International Accounting Standard 34 and comply with IFRS accounting policies and interpretations[97](index=97&type=chunk) - The financial statements were approved and authorized for issue by the Board of Directors on August 14, 2025[97](index=97&type=chunk) [Basis of Presentation](index=37&type=section&id=Basis%20of%20Presentation) The condensed consolidated interim financial statements adopt accounting policies and measurement methods consistent with the annual consolidated financial statements for the year ended December 31, 2024, and should be read in conjunction with those annual statements - The condensed consolidated interim financial statements adopt accounting policies and measurement methods consistent with the annual consolidated financial statements for the year ended December 31, 2024[98](index=98&type=chunk) - The financial statements should be read in conjunction with the company's annual consolidated financial statements for the year ended December 31, 2024[98](index=98&type=chunk) [Adoption of New and Revised Standards and Interpretations](index=38&type=section&id=Adoption%20of%20New%20and%20Revised%20Standards%20and%20Interpretations) No other new or revised IFRS or interpretations, apart from those already disclosed as not yet effective, are expected to have a significant impact on the company - No other new or revised IFRS or interpretations, apart from those already disclosed as not yet effective, are expected to have a significant impact on the company[99](index=99&type=chunk) [Segment Information](index=38&type=section&id=Segment%20Information) The company has only one reportable operating segment, the coal segment, primarily engaged in coal mining, development, and exploration in Mongolia, and coal logistics and trading in Mongolia and China; revenue is mainly derived from Chinese customers, with two largest customers contributing over 10% of total revenue - The company has only one reportable operating segment, the coal segment, primarily engaged in coal mining, development, and exploration in Mongolia, and coal logistics and trading in Mongolia and China[100](index=100&type=chunk) - For the six months ended June 30, 2025 and 2024, two customers each contributed over **10%** of total revenue, with the largest customer accounting for **20%** (2024: 15%) and the second largest for **12%** (2024: 12%)[101](index=101&type=chunk) - For the six months ended June 30, 2025, the company's revenue primarily originated from China (**$278.2 million**), and non-current assets were mainly located in Mongolia (**$277.2 million**)[103](index=103&type=chunk) [Information on Major Customers](index=38&type=section&id=Information%20on%20Major%20Customers) For the six months ended June 30, 2025 and 2024, the company had 70 and 50 active customers, respectively; two customers each contributed over 10% of total revenue, with the largest customer accounting for 20% (2024: 15%) and the second largest for 12% (2024: 12%) - For the six months ended June 30, 2025 and 2024, the company had **70** and **50** active customers, respectively[101](index=101&type=chunk) - Two customers each contributed over **10%** of total revenue, with the largest customer accounting for **20%** (2024: 15%) and the second largest for **12%** (2024: 12%)[101](index=101&type=chunk) [Geographical Information](index=38&type=section&id=Geographical%20Information) The company's operations are primarily located in Mongolia, Hong Kong, and China; for the six months ended June 30, 2025, the vast majority of revenue ($278.2 million) was generated from China, while non-current assets were mainly concentrated in Mongolia ($277.2 million) - The company's operations are primarily located in Mongolia, Hong Kong, and China[102](index=102&type=chunk) | Metric (thousand USD) | Mongolia | Hong Kong | China | Consolidated Total | | :--- | :--- | :--- | :--- | :--- | | **Revenue (2025 H1)** | 4 | – | 278,152 | 278,156 | | **Non-Current Assets (June 30, 2025)** | 277,183 | 357 | 1,149 | 278,689 | [Revenue](index=38&type=section&id=Revenue) Revenue is derived from coal trading and recognized when customers obtain control of the goods and services - Revenue is derived from coal trading and recognized when customers obtain control of the goods and services[104](index=104&type=chunk) [Expenses by Nature](index=39&type=section&id=Expenses%20by%20Nature) In Q2 and H1 2025, the company's total operating expenses significantly increased, primarily due to higher depreciation, employee benefit expenses, impairment loss on coal inventory, and mine operating costs | Metric (thousand USD) | 2025 Q2 | 2024 Q2 | 2025 H1 | 2024 H1 | | :--- | :--- | :--- | :--- | :--- | | Depreciation | 12,254 | 3,555 | 21,378 | 5,944 | | Employee Benefit Expenses | 4,460 | 3,535 | 9,878 | 7,919 | | Impairment Loss on Coal Inventory | 12,348 | – | 12,348 | – | | Mine Operating Costs and Others | 135,301 | 58,649 | 247,573 | 90,795 | | **Total Operating Expenses** | **169,615** | **77,776** | **308,156** | **127,797** | [Cost of Sales](index=40&type=section&id=Cost%20of%20Sales) In Q2 and H1 2025, cost of sales significantly increased, primarily comprising operating expenses, depreciation and depletion, royalties, and cost of sales of idle mine assets; inventory costs also increased substantially | Metric (thousand USD) | 2025 Q2 | 2024 Q2 | 2025 H1 | 2024 H1 | | :--- | :--- | :--- | :--- | :--- | | Operating Expenses | 136,759 | 59,483 | 251,441 | 92,854 | | Depreciation and Depletion | 11,842 | 3,355 | 20,617 | 5,565 | | Royalties | 10,540 | 10,662 | 20,521 | 20,568 | | Cost of Sales of Idle Mine Assets | 311 | 64 | 562 | 110 | | **Cost of Sales** | **159,452** | **73,582** | **293,141** | **119,115** | - For the three and six months ended June 30, 2025, inventory costs recognized as cost of sales totaled **$119,692** and **$221,516**, respectively, a significant increase from the prior year[107](index=107&type=chunk) [Net Other Operating Expenses](index=40&type=section&id=Net%20Other%20Operating%20Expenses) In Q2 and H1 2025, net other operating expenses significantly increased, primarily due to a $12.3 million impairment loss on coal inventory, partially offset by the write-off of other payables | Metric (thousand USD) | 2025 Q2 | 2024 Q2 | 2025 H1 | 2024 H1 | | :--- | :--- | :--- | :--- | :--- | | Administrative Expenses | 2,229 | 1,268 | 3,917 | 2,384 | | Net Foreign Exchange Loss/(Gain) | (914) | 382 | (945) | 582 | | Impairment Loss on Coal Inventory | 12,348 | – | 12,348 | – | | Write-off of Other Payables | (6,272) | – | (6,272) | – | | **Net Other Operating Expenses** | **7,013** | **1,157** | **8,584** | **2,210** | [Finance Costs and Income](index=41&type=section&id=Finance%20Costs%20and%20Income) In Q2 and H1 2025, finance costs, primarily consisting of interest expense on convertible bonds, decreased compared to the prior year; finance income mainly arose from fair value gains on embedded derivatives of convertible bonds and interest income | Metric (thousand USD) | 2025 Q2 | 2024 Q2 | 2025 H1 | 2024 H1 | | :--- | :--- | :--- | :--- | :--- | | Interest Expense on Convertible Bonds | 8,915 | 9,686 | 17,536 | 18,929 | | **Finance Costs** | **9,140** | **10,322** | **17,952** | **20,655** | | Fair Value Gain on Embedded Derivatives of Convertible Bonds | 40 | 688 | 55 | – | | Interest Income | 13 | 34 | 19 | 107 | | **Finance Income** | **53** | **722** | **74** | **107** | [Taxation](index=41&type=section&id=Taxation) In Q2 and H1 2025, the company's current income tax expense, primarily from jurisdictions outside Canada, significantly decreased compared to the prior year | Metric (thousand USD) | 2025 Q2 | 2024 Q2 | 2025 H1 | 2024 H1 | | :--- | :--- | :--- | :--- | :--- | | Current Tax - Other Jurisdictions | 284 | 8,585 | 2,450 | 18,376 | | **Total Tax Expense for the Period** | **284** | **8,585** | **2,450** | **18,376** | [Earnings/(Loss) Per Share](index=42&type=section&id=Earnings%2F%28Loss%29%20Per%20Share) In Q2 and H1 2025, the company's basic and diluted loss per share were $0.077 and $0.165, respectively, representing an expanded loss or a shift from profit to loss compared to the prior year | Metric | 2025 Q2 | 2024 Q2 | 2025 H1 | 2024 H1 | | :--- | :--- | :--- | :--- | :--- | | Net Profit/(Loss) (thousand USD) | (22,806) | (2,085) | (49,011) | 10,167 | | Weighted Average Number of Shares (thousands) | 296,705 | 295,844 | 296,705 | 295,987 | | **Basic and Diluted Earnings/(Loss) Per Share (USD)** | **(0.077)** | **(0.007)** | **(0.165)** | **0.034** | - In calculating diluted loss, the related shares embedded in anti-dilutive convertible bonds and share options were not included[111](index=111&type=chunk) [Cash and Cash Equivalents](index=42&type=section&id=Cash%20and%20Cash%20Equivalents) As of June 30, 2025, the company's cash and cash equivalents were $2.614 million, a significant decrease from $8.59 million as of December 31, 2024; cash is primarily denominated in RMB and Mongolian Tugrik, and exchange rate fluctuations have a sensitive impact on profit/loss before tax | Metric (thousand USD) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and Bank Balances | 3,452 | 8,864 | | Less: Restricted Cash | (838) | (274) | | **Cash and Cash Equivalents** | **2,614** | **8,590** | - Cash is primarily denominated in RMB (**$1,826 thousand**) and Mongolian Tugrik (**$439 thousand**)[112](index=112&type=chunk) | Exchange Rate Change | June 30, 2025 (thousand USD) | December 31, 2024 (thousand USD) | | :--- | :--- | :--- | | Foreign currency exchange rate increase/+5% | 422 | 273 | | Foreign currency exchange rate decrease/-5% | (422) | (273) | [Trade and Other Receivables](index=43&type=section&id=Trade%20and%20Other%20Receivables) As of June 30, 2025, total trade and other receivables amounted to $17.233 million, a significant decrease from $31.486 million as of December 31, 2024, with most balances less than one month old; the company provides for expected credit losses based on days past due, with an ending provision of $21.876 million | Metric (thousand USD) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Trade Receivables | 15,710 | 25,418 | | Other Receivables | 1,523 | 6,068 | | **Total Trade and Other Receivables** | **17,233** | **31,486** | - As of June 30, 2025, the loss allowance for trade and other receivables was **$21.876 million**[116](index=116&type=chunk)[117](index=117&type=chunk) [Trade and Other Payables](index=44&type=section&id=Trade%20and%20Other%20Payables) As of June 30, 2025, total trade and other payables amounted to $212.3 million, an increase from $169.3 million as of December 31, 2024, with $84.41 million of payables outstanding for over six months | Aging | June 30, 2025 (thousand USD) | December 31, 2024 (thousand USD) | | :--- | :--- | :--- | | Less than 1 month | 49,885 | 53,646 | | 1 to 3 months | 52,930 | 50,936 | | 3 to 6 months | 25,064 | 18,205 | | More than 6 months | 84,410 | 46,494 | | **Total Trade and Other Payables** | **212,289** | **169,281** | [Accumulated Losses and Dividends](index=44&type=section&id=Accumulated%20Losses%20and%20Dividends) As of June 30, 2025, the company's accumulated losses increased to $1,198.2 million from $1,149.2 million as of December 31, 2024; the company has not paid or declared any dividends since its inception | Metric (thousand USD) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Accumulated Losses | (1,198,236) | (1,149,222) | - The company has not paid or declared any dividends since its inception[120](index=120&type=chunk) [Other Information](index=45&type=section&id=Other%20Information) [Interim Results Review](index=45&type=section&id=Interim%20Results%20Review) The company's condensed consolidated interim financial statements for the three and six months ended June 30, 2025, are unaudited but have been reviewed by the company's audit committee and are available on SEDAR+ and the company's website - The company's condensed consolidated interim financial statements for the three and six months ended June 30, 2025, are unaudited but have been reviewed by the company's audit committee[121](index=121&type=chunk) [About SouthGobi](index=45&type=section&id=About%20SouthGobi) SouthGobi Resources Ltd. is listed on the HKEX and TSX-V, owns and operates the Ovoot Tolgoi coal mine in Mongolia, holds mining licenses for other coking and thermal coal deposits, and primarily sells coal to Chinese customers - SouthGobi Resources Ltd. is listed on the HKEX and TSX-V and owns and operates the Ovoot Tolgoi coal mine in Mongolia[122](index=122&type=chunk) - The company holds mining licenses for other coking and thermal coal deposits in Mongolia and primarily sells coal to Chinese customers[122](index=122&type=chunk) [Contact Information](index=45&type=section&id=Contact%20Information) Contact information for investors is provided, including email and office phone, along with details for CEO Mr. Ruibin Xu and the company website - Investors can contact the company via email at info@southgobi.com or by office phone[123](index=123&type=chunk)[124](index=124&type=chunk) - The CEO is Mr. Ruibin Xu, and the company website is www.southgobi.com[124](index=124&type=chunk) [Forward-Looking Statements](index=45&type=section&id=Forward-Looking%20Statements) The report contains numerous forward-looking statements regarding the company's going concern ability, future liquidity, discussions with the Mongolian government, operational plans, litigation outcomes, and market outlook; these statements are based on management's current opinions and estimates but are subject to various risks and uncertainties, and actual results may differ materially, with no obligation for the company to update them - The report contains numerous forward-looking statements regarding the company's going concern ability, future liquidity, discussions with the Mongolian government, operational plans, litigation outcomes, and market outlook[125](index=125&type=chunk)[126](index=126&type=chunk) - Forward-looking statements are based on management's current opinions and estimates but are subject to various risks, uncertainties, and other factors, and actual events or results may differ materially from expectations[127](index=127&type=chunk) - The company has no obligation to update forward-looking statements, and readers should not place undue reliance on them[128](index=128&type=chunk) [Disclaimer](index=48&type=section&id=Disclaimer) Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited assume no responsibility for the contents of this announcement and make no representation as to its accuracy or completeness; TSX-V and its Regulation Services Provider also bear no responsibility for the adequacy or accuracy of this announcement - The Stock Exchange of Hong Kong Limited assumes no responsibility for the contents of this announcement and makes no representation as to its accuracy or completeness[1](index=1&type=chunk) - TSX-V and its Regulation Services Provider assume no responsibility for the adequacy or accuracy of the contents of this announcement[129](index=129&type=chunk)

財務摘要 截至6月30日止六個月 | | 2025年 | 2024年 | 同比變動 | | --- | --- | --- | --- | | | 人民幣千元 | 人民幣千元 | （%） | | | （未經審計）（未經審計） | | | | 收入 | 35,290,047 | 28,343,961 | 24.5 | | 毛利 | 8,891,918 | 6,699,943 | 32.7 | | 經營盈利(1) | 2,127,048 | 1,035,018 | 105.5 | | 除稅前盈利 | 2,863,666 | 2,439,342 | 17.4 | | 期間盈利 | 2,591,347 | 2,034,378 | 27.4 | | 期間非國際財務報告準則盈利(2) | 3,570,104 | 2,643,770 | 35.0 | 香港交易及結算所有限公司及香港聯合交易所有限公司（「香港聯交所」）對本公告的內容概不負責，對其準確性或 完整性亦不發表任何聲明，並明確表示概不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。 JD Health International I ...

香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，對其準確性或完整 性亦不發表任何聲明，並明確表示，概不對因本公告全部或任何部分內容而產生或因倚賴該等內容而 引致的任何損失承擔任何責任。 GCL New Energy Holdings Limited 協鑫新能源控股有限公司 （於百慕達註冊成立之有限公司） （股份代號：451） 有關截至二零二四年十二月三十一日止年度之 年報之補充公告 茲提述協鑫新能源控股有限公司（「本公司」，連同其附屬公司，「本集團」）於二零二五 年四月二十八日發佈的截至二零二四年十二月三十一日止年度之年報（「二零二四年年 報」）。除文義另有界定者外，本公告所用詞彙與二零二四年年報所界定者具有相同涵 義。 除二零二四年年報所提供的資料外，本公司謹此提供下列有關二零二四年年報之補充 資料： 二零二二年配售事項所得款項用途 本公司謹此根據上市規則附錄D2第11(8)段提供以下進一步資料，內容有關於二零 二二年八月自先舊後新配售及認購股份事項籌集的所得款項淨額約 3.1億港元（「二零 二二年配售事項」）的用途。 – 1 – 二零二二年配售事項的所得款項用途詳情如下： 截至 | ...

Announcement Information [Company Information and Announcement Statement](index=1&type=section&id=Company%20Information%20and%20Announcement%20Statement) JD.com, Inc. discloses unaudited Q2 and interim 2025 results, operating with a dual-class share structure where ADSs represent Class A ordinary shares - JD.com, Inc. announced its unaudited results for Q2 and interim 2025[2](index=2&type=chunk)[3](index=3&type=chunk) - The company operates with a dual-class share structure: **Class A ordinary shares** (1 vote/share), **Class B ordinary shares** (20 votes/share), and **ADSs** (represent two Class A ordinary shares)[1](index=1&type=chunk) [Q2 and Interim 2025 Earnings Announcement](index=1&type=section&id=Q2%20and%20Interim%202025%20Earnings%20Announcement) This announcement formally releases JD Group's unaudited Q2 and interim 2025 results, signed by Chairman Richard Qiangdong Liu - Announcement of unaudited results for the three and six months ended June 30, 2025[3](index=3&type=chunk) - Mr. Richard Qiangdong Liu, Chairman of the Board, signed this announcement and listed board members[3](index=3&type=chunk) Performance Highlights [Management Commentary](index=2&type=section&id=Management%20Commentary) CEO Xu Ran highlighted significant user growth and record retail operating margin, while CFO Sandy Xu noted strong revenue growth and improved retail gross margin - CEO Ms. Xu Ran reported significant growth in user traffic, quarterly active users, and purchase frequency in Q2, with core JD Retail revenue increasing by **20.6%** and operating margin reaching **4.5%**, a record high for a major promotion quarter[7](index=7&type=chunk) - CFO Mr. Sandy Xu stated that total group revenue increased by **22.4%** year-over-year, with core retail gross margin growing for **13 consecutive quarters** and operating margin steadily rising[10](index=10&type=chunk) - JD Waimai (delivery) business developed healthily, forming effective synergy with JD Retail and other existing businesses, achieving initial strategic goals[7](index=7&type=chunk) [Q2 2025 Key Financial Highlights](index=2&type=section&id=Q2%202025%20Key%20Financial%20Highlights) JD Group's Q2 2025 total revenue grew 22.4% to RMB 356.7 billion, but net income attributable to ordinary shareholders declined 2025 Q2 Key Financial Data | Indicator | 2025 Q2 (RMB billion) | 2024 Q2 (RMB billion) | YoY Change | Notes | | :--- | :--- | :--- | :--- | :--- | | **Total Revenue** | 356.7 | 291.4 | +22.4% | | | **Net Income Attributable to Ordinary Shareholders** | 6.2 | 12.6 | -50.8% | | | **Non-GAAP Net Income Attributable to Ordinary Shareholders** | 7.4 | 14.5 | -48.9% | | | **Diluted Earnings Per ADS** | 4.15 | 8.19 | -49.3% | | | **Non-GAAP Diluted Earnings Per ADS** | 4.97 | 9.36 | -46.9% | | | **JD Retail Revenue** | 310.1 | 257.072 | +20.6% | | | **JD Retail Operating Income** | 13.9 | 10.1 | +37.6% | | | **JD Retail Operating Margin** | 4.5% | 3.9% | +0.6% | Record high for major promotion quarter | [Share Repurchase Program](index=3&type=section&id=Share%20Repurchase%20Program) JD repurchased $1.5 billion in shares by June 30, 2025, under its $5 billion program, with $3.5 billion remaining - As of June 30, 2025, the company repurchased approximately **80.7 million Class A ordinary shares** (**40.4 million ADSs**), totaling approximately **$1.5 billion**[10](index=10&type=chunk) - Repurchased shares accounted for **2.8%** of ordinary shares outstanding as of December 31, 2024[10](index=10&type=chunk)[12](index=12&type=chunk) - **$3.5 billion** remains under the share repurchase program (up to $5 billion, valid until August 2027)[10](index=10&type=chunk) Business Development [JD Retail](index=3&type=section&id=JD%20Retail) JD Retail drove new product sales and trend categories through customized offerings and the "Accelerated Upgrade Program," expanding JD MALL - JD Super (supermarket) launched customized products across 6 categories (packaging, IP, gift boxes, craftsmanship, functions, and raw materials) to offer differentiated shopping experiences and help brands avoid homogenization[11](index=11&type=chunk) - Launched the 3C Digital "Accelerated Upgrade Program" to support new product sales and increase support for trend categories like **AI glasses** and **embodied intelligent robots**[11](index=11&type=chunk) - In Q2 2025, JD MALL opened new stores in multiple cities including Beijing, Shenzhen, Nanjing, Wuhan, and Taiyuan, with a cumulative total of **24 stores** by the end of June, providing immersive, digital shopping experiences integrating online and offline[11](index=11&type=chunk) [JD Logistics](index=4&type=section&id=JD%20Logistics) JD Logistics expanded its "Global Supply Chain Network" with new overseas warehouses and launched "JoyExpress" in Saudi Arabia, scaling its "Smart Wolf" system - JD Logistics accelerated its "Global Supply Chain Network" initiative, opening new overseas warehouses in multiple countries in the first half of the year, with over **130 bonded, direct mail, and overseas warehouses** by June 30, 2025, totaling over **1.3 million square meters** of managed area, covering **23 countries and regions**[13](index=13&type=chunk) - Launched its self-operated express delivery brand **"JoyExpress"** in Saudi Arabia, forming a complete logistics network from warehousing and sorting to last-mile delivery, upgrading its localized overseas operations[13](index=13&type=chunk) - The self-developed efficient intelligent warehousing solution **"Smart Wolf"** system has been scaled nationwide, integrating core components like handling robots and flying ladder robots, achieving high-density storage and significantly improving warehouse operational efficiency[14](index=14&type=chunk) [JD Health](index=5&type=section&id=JD%20Health) JD Health solidified its "first platform for exclusive new and specialty drug launches" by selling innovative weight-loss and anti-influenza drugs online - JD Health solidified its "first platform for exclusive new and specialty drug launches" advantage, successfully selling Innovent Biologics' weight-loss innovative drug **Xinermai®** and Qingfeng Pharmaceutical's domestic anti-influenza new drug **Yisuda®** online[15](index=15&type=chunk) [New Businesses](index=5&type=section&id=New%20Businesses) JD Waimai achieved significant growth during JD 618, forming synergies, while 7Fresh Kitchen launched in July 2025 - JD Waimai business developed healthily, with daily orders exceeding **25 million** during JD 618, over **1.5 million quality merchants** onboarded, and the full-time rider force surpassing **150,000**[16](index=16&type=chunk) - JD Waimai is deeply integrated into the overall JD ecosystem, leveraging synergistic value with existing businesses on the user, fulfillment, and supply sides[16](index=16&type=chunk) - Launched **7Fresh Kitchen** in July 2025, innovating the catering delivery market supply chain through a "dish partner model"[16](index=16&type=chunk) [Environmental, Social, and Governance](index=5&type=section&id=Environmental%2C%20Social%2C%20and%20Governance) JD's ecosystem employed approximately 900,000 people by June 30, 2025, with human resource expenditure reaching RMB 136 billion - As of June 30, 2025, the total number of personnel within the JD ecosystem was approximately **900,000** (including part-time, interns, and personnel from affiliated companies)[17](index=17&type=chunk) - Total human resource expenditure within the JD ecosystem for the twelve months ended June 30, 2025, reached **RMB 136 billion**[17](index=17&type=chunk) Financial Analysis [Q2 2025 Consolidated Financial Results](index=6&type=section&id=Q2%202025%20Consolidated%20Financial%20Results) JD Group's Q2 2025 total revenue grew 22.4% to RMB 356.7 billion, but increased expenses led to an operating loss [Revenue](index=6&type=section&id=Revenue) In Q2 2025, JD Group's total revenue increased by 22.4% to RMB 356.7 billion, driven by growth in both product and service revenues 2025 Q2 Revenue Composition | Indicator | 2025 Q2 (RMB billion) | 2024 Q2 (RMB billion) | YoY Growth | | :--- | :--- | :--- | :--- | | **Total Revenue** | 356.7 | 291.4 | 22.4% | | Product Revenue | 282.414 | 233.908 | 20.7% | | Service Revenue | 74.246 | 57.489 | 29.1% | [Cost of Revenues](index=6&type=section&id=Cost%20of%20Revenues) In Q2 2025, cost of revenues increased by 22.2% to RMB 300 billion, largely in line with revenue growth 2025 Q2 Cost of Revenues | Indicator | 2025 Q2 (RMB billion) | 2024 Q2 (RMB billion) | YoY Growth | | :--- | :--- | :--- | :--- | | Cost of Revenues | 300 | 245.5 | 22.2% | [Fulfillment Expenses](index=6&type=section&id=Fulfillment%20Expenses) Fulfillment expenses increased by 28.6% to RMB 22.1 billion, rising to 6.2% of revenue due to enhanced capabilities 2025 Q2 Fulfillment Expenses | Indicator | 2025 Q2 (RMB billion) | 2024 Q2 (RMB billion) | YoY Growth | % of Revenue (2025 Q2) | % of Revenue (2024 Q2) | | :--- | :--- | :--- | :--- | :--- | :--- | | Fulfillment Expenses | 22.1 | 17.2 | 28.6% | 6.2% | 5.9% | - Fulfillment expenses increased primarily due to the company's continuous optimization of fulfillment capabilities and increased human resource investment to enhance user experience[19](index=19&type=chunk) [Marketing Expenses](index=6&type=section&id=Marketing%20Expenses) Marketing expenses surged by 127.6% to RMB 27 billion, increasing to 7.6% of revenue, primarily due to new business promotion activities 2025 Q2 Marketing Expenses | Indicator | 2025 Q2 (RMB billion) | 2024 Q2 (RMB billion) | YoY Growth | % of Revenue (2025 Q2) | % of Revenue (2024 Q2) | | :--- | :--- | :--- | :--- | :--- | :--- | | Marketing Expenses | 27 | 11.9 | 127.6% | 7.6% | 4.1% | - Marketing expenses significantly increased primarily due to higher spending on new business promotion activities[19](index=19&type=chunk) [Research and Development Expenses](index=6&type=section&id=Research%20and%20Development%20Expenses) Research and development expenses increased by 25.7% to RMB 5.3 billion, with its percentage of revenue slightly rising to 1.5% 2025 Q2 Research and Development Expenses | Indicator | 2025 Q2 (RMB billion) | 2024 Q2 (RMB billion) | YoY Growth | % of Revenue (2025 Q2) | % of Revenue (2024 Q2) | | :--- | :--- | :--- | :--- | :--- | :--- | | Research and Development Expenses | 5.3 | 4.2 | 25.7% | 1.5% | 1.4% | [General and Administrative Expenses](index=6&type=section&id=General%20and%20Administrative%20Expenses) General and administrative expenses increased by 53.2% to RMB 3.3 billion, rising to 0.9% of revenue, mainly due to higher share-based compensation 2025 Q2 General and Administrative Expenses | Indicator | 2025 Q2 (RMB billion) | 2024 Q2 (RMB billion) | YoY Growth | % of Revenue (2025 Q2) | % of Revenue (2024 Q2) | | :--- | :--- | :--- | :--- | :--- | :--- | | General and Administrative Expenses | 3.3 | 2.1 | 53.2% | 0.9% | 0.7% | - General and administrative expenses increased primarily due to higher share-based compensation expenses[20](index=20&type=chunk) [Operating Income/(Loss) and Non-GAAP Operating Income](index=6&type=section&id=Operating%20Income%2F(Loss)%20and%20Non-GAAP%20Operating%20Income) The company reported an operating loss of RMB 0.9 billion in Q2 2025, with non-GAAP operating income also declining due to new business investments 2025 Q2 Operating Income/(Loss) | Indicator | 2025 Q2 (RMB billion) | 2024 Q2 (RMB billion) | YoY Change | | :--- | :--- | :--- | :--- | | Operating Income/(Loss) | (0.9) | 10.5 | From profit to loss | | Operating Margin | -0.2% | 3.6% | -3.8% | | Non-GAAP Operating Income | 0.9 | 11.6 | -92.2% | | Non-GAAP Operating Margin | 0.3% | 4.0% | -3.7% | | JD Retail Operating Income | 13.9 | 10.1 | +37.6% | | JD Retail Operating Margin | 4.5% | 3.9% | +0.6% | - Operating income decreased primarily due to increased strategic investments in new businesses[20](index=20&type=chunk) [Non-GAAP EBITDA](index=7&type=section&id=Non-GAAP%20EBITDA) Non-GAAP EBITDA significantly decreased to RMB 3 billion in Q2 2025, with the EBITDA margin falling from 4.6% to 0.8% 2025 Q2 Non-GAAP EBITDA | Indicator | 2025 Q2 (RMB billion) | 2024 Q2 (RMB billion) | YoY Change | | :--- | :--- | :--- | :--- | | Non-GAAP EBITDA | 3 | 13.5 | -77.8% | | Non-GAAP EBITDA Margin | 0.8% | 4.6% | -3.8% | [Net Income Attributable to Ordinary Shareholders and Non-GAAP Net Income Attributable to Ordinary Shareholders](index=7&type=section&id=Net%20Income%20Attributable%20to%20Ordinary%20Shareholders%20and%20Non-GAAP%20Net%20Income%20Attributable%20to%20Ordinary%20Shareholders) Both GAAP and Non-GAAP net income attributable to ordinary shareholders significantly decreased in Q2 2025, with lower net income margins 2025 Q2 Net Income Attributable to Ordinary Shareholders | Indicator | 2025 Q2 (RMB billion) | 2024 Q2 (RMB billion) | YoY Change | | :--- | :--- | :--- | :--- | | Net Income Attributable to Ordinary Shareholders | 6.2 | 12.6 | -50.8% | | Net Income Margin | 1.7% | 4.3% | -2.6% | | Non-GAAP Net Income Attributable to Ordinary Shareholders | 7.4 | 14.5 | -48.9% | | Non-GAAP Net Income Margin | 2.1% | 5.0% | -2.9% | [Diluted Earnings Per Share and Non-GAAP Diluted Earnings Per Share](index=7&type=section&id=Diluted%20Earnings%20Per%20Share%20and%20Non-GAAP%20Diluted%20Earnings%20Per%20Share) In Q2 2025, both GAAP and Non-GAAP diluted earnings per ADS significantly decreased compared to the prior year 2025 Q2 Diluted Earnings Per ADS | Indicator | 2025 Q2 (RMB) | 2024 Q2 (RMB) | YoY Change | | :--- | :--- | :--- | :--- | | Diluted Earnings Per ADS | 4.15 | 8.19 | -49.3% | | Non-GAAP Diluted Earnings Per ADS | 4.97 | 9.36 | -46.9% | [Cash Flow and Working Capital](index=7&type=section&id=Cash%20Flow%20and%20Working%20Capital) Total cash and investments were RMB 223.4 billion by June 30, 2025, but Q2 free cash flow significantly decreased, with mixed cash flows from investing and financing [Cash Flow for the Three Months Ended June 30, 2025](index=7&type=section&id=Cash%20Flow%20for%20the%20Three%20Months%20Ended%20June%2030%2C%202025) Q2 2025 operating cash flow was RMB 24.409 billion, but free cash flow significantly decreased, with investing activities generating net inflow 2025 Q2 Cash Flow | Indicator | 2025 Q2 (RMB million) | 2024 Q2 (RMB million) | YoY Change | | :--- | :--- | :--- | :--- | | Net Cash Generated from Operating Activities | 24,409 | 50,738 | -51.9% | | Free Cash Flow | 22,018 | 49,555 | -55.6% | | Net Cash Generated from Investing Activities | 8,218 | (38,527) | From outflow to inflow | | Net Cash Used in Financing Activities | (12,439) | (8,969) | -38.7% | - Net cash inflow from investing activities primarily included net cash received from maturities of time deposits and wealth management products[26](index=26&type=chunk) - Net cash outflow from financing activities primarily included cash paid for dividends, repurchases of ordinary shares, and acquisitions of additional equity in non-wholly owned subsidiaries[26](index=26&type=chunk) [Cash Flow for the Twelve Months Ended June 30, 2025](index=8&type=section&id=Cash%20Flow%20for%20the%20Twelve%20Months%20Ended%20June%2030%2C%202025) For the twelve months ended June 30, 2025, free cash flow significantly decreased to RMB 10.076 billion Free Cash Flow for the Twelve Months Ended June 30, 2025 | Indicator | June 30, 2025 (RMB million) | June 30, 2024 (RMB million) | YoY Change | | :--- | :--- | :--- | :--- | | Net Cash Generated from Operating Activities | 24,819 | 74,040 | -66.5% | | Free Cash Flow | 10,076 | 55,642 | -81.9% | [Segment Results](index=8&type=section&id=Segment%20Results) JD Group's three segments, JD Retail, JD Logistics, and New Businesses, showed varied revenue growth and operating margin performance in Q2 2025 [Segment Revenue and Operating Income](index=9&type=section&id=Segment%20Revenue%20and%20Operating%20Income) JD Retail revenue grew 20.6% with improved margin, while New Businesses saw high revenue growth but expanded losses in Q2 2025 2025 Q2 Segment Revenue and Operating Income | Segment | 2025 Q2 Revenue (RMB million) | 2024 Q2 Revenue (RMB million) | Revenue YoY Change | 2025 Q2 Operating Income (RMB million) | 2024 Q2 Operating Income (RMB million) | Operating Margin (2025 Q2) | Operating Margin (2024 Q2) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | JD Retail | 310,075 | 257,072 | 20.6% | 13,939 | 10,108 | 4.5% | 3.9% | | JD Logistics | 51,564 | 44,207 | 16.6% | 1,958 | 2,183 | 3.8% | 4.9% | | New Businesses | 13,852 | 4,636 | 198.8% | (14,777) | (695) | (106.7)% | (15.0)% | - New businesses' operating loss significantly expanded, primarily reflecting increased strategic investments in new businesses[20](index=20&type=chunk) [Revenue Composition](index=11&type=section&id=Revenue%20Composition) Q2 2025 saw growth in product revenue from electronics and general merchandise, alongside strong increases in service revenue 2025 Q2 Revenue Composition | Revenue Category | 2025 Q2 (RMB million) | 2024 Q2 (RMB million) | YoY Change | | :--- | :--- | :--- | :--- | | Electronics and Home Appliances Product Revenue | 178,982 | 145,061 | 23.4% | | General Merchandise Product Revenue | 103,432 | 88,847 | 16.4% | | **Total Product Revenue** | **282,414** | **233,908** | **20.7%** | | Platform and Advertising Services Revenue | 28,507 | 23,425 | 21.7% | | Logistics and Other Services Revenue | 45,739 | 34,064 | 34.3% | | **Total Service Revenue** | **74,246** | **57,489** | **29.1%** | | **Total Revenue** | **356,660** | **291,397** | **22.4%** | [Supplemental Financial Information and Business Metrics](index=24&type=section&id=Supplemental%20Financial%20Information%20and%20Business%20Metrics) Trailing twelve-month operating and free cash flows significantly decreased by Q2 2025, while inventory and receivables turnover days increased Trailing Twelve-Month Cash Flow and Turnover Days | Indicator | 2024 Q2 | 2024 Q3 | 2024 Q4 | 2025 Q1 | 2025 Q2 | | :--- | :--- | :--- | :--- | :--- | :--- | | Operating Cash Flow — TTM (RMB billion) | 74.0 | 52.8 | 58.1 | 51.1 | 24.8 | | Free Cash Flow — TTM (RMB billion) | 55.6 | 33.6 | 43.7 | 37.6 | 10.1 | | Inventory Turnover Days — TTM | 29.8 | 30.4 | 31.5 | 32.8 | 34.1 | | Accounts Payable Turnover Days — TTM | 57.0 | 57.5 | 58.6 | 57.6 | 59.0 | | Accounts Receivable Turnover Days — TTM | 5.7 | 5.8 | 5.9 | 6.4 | 7.4 | Supplemental Information [Definitions of Non-GAAP Measures](index=13&type=section&id=Definitions%20of%20Non-GAAP%20Measures) This section defines Non-GAAP metrics used by JD Group to assess core operating performance by excluding non-cash or non-recurring items - Non-GAAP operating income excludes share-based compensation expenses, amortization of intangible assets, impact of business cooperation arrangements, gains from sale of development properties, and impairment of goodwill/long-lived assets[37](index=37&type=chunk) - Free cash flow is defined as net cash generated from operating activities, adjusted for the impact of consumer credit receivables and capital expenditures[37](index=37&type=chunk) - Non-GAAP measures aim to exclude non-cash or non-recurring items to provide a more meaningful period-to-period comparison and view of core operating results[38](index=38&type=chunk)[39](index=39&type=chunk) [Reconciliations of GAAP to Non-GAAP Results](index=25&type=section&id=Reconciliations%20of%20GAAP%20to%20Non-GAAP%20Results) This section reconciles GAAP to Non-GAAP operating income, EBITDA, and net income, detailing adjustments for non-cash and non-recurring items 2025 Q2 GAAP to Non-GAAP Operating Income Reconciliation | Indicator | 2025 Q2 (RMB million) | 2024 Q2 (RMB million) | | :--- | :--- | :--- | | Operating Income/(Loss) (GAAP) | (859) | 10,501 | | Add: Share-based compensation expenses | 1,657 | 666 | | Add: Amortization of intangible assets | 253 | 316 | | Add: Impact of business cooperation arrangements | 69 | 113 | | Less: Gains from sale of development properties | (224) | — | | **Non-GAAP Operating Income** | **896** | **11,596** | | Non-GAAP Operating Margin | 0.3% | 4.0% | 2025 Q2 GAAP to Non-GAAP Net Income Attributable to Ordinary Shareholders Reconciliation | Indicator | 2025 Q2 (RMB million) | 2024 Q2 (RMB million) | | :--- | :--- | :--- | | Net Income Attributable to Ordinary Shareholders (GAAP) | 6,178 | 12,644 | | Add: Share-based compensation expenses | 1,578 | 549 | | Add: Amortization of intangible assets | 169 | 151 | | Add/(Reversal of): Adjustments for equity method investments | (185) | 211 | | Add: Impairment of goodwill, long-lived assets and investments | 178 | 1,102 | | (Reversal of)/Add: Fair value change of long-term investments | (531) | (104) | | Less: Gains from sale of development properties | (168) | — | | Less: Gains from disposal of investments and others | (30) | (208) | | Add: Impact of business cooperation arrangements | 69 | 113 | | Add/(Reversal of): Income tax impact of Non-GAAP adjustments | 136 | 2 | | **Non-GAAP Net Income Attributable to Ordinary Shareholders** | **7,394** | **14,460** | | Non-GAAP Net Income Margin | 2.1% | 5.0% | [Reconciliations of GAAP to IFRS](index=27&type=section&id=Reconciliations%20of%20GAAP%20to%20IFRS) This section reconciles JD Group's condensed consolidated statements from GAAP to IFRS, with Deloitte Touche Tohmatsu providing limited assurance [Assurance Engagement Statement](index=27&type=section&id=Assurance%20Engagement%20Statement) Deloitte Touche Tohmatsu performed a limited assurance engagement on the GAAP to IFRS reconciliation, finding no material inaccuracies - Deloitte Touche Tohmatsu performed a limited assurance engagement on the GAAP to IFRS reconciliation[54](index=54&type=chunk) - The engagement found no matters suggesting the reconciliation was arithmetically inaccurate or failed to reflect accounting policy differences in all material respects[57](index=57&type=chunk)[58](index=58&type=chunk) [Condensed Consolidated Statements of Operations Reconciliation](index=29&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20Reconciliation) This section details the GAAP to IFRS reconciliation for consolidated statements of operations, highlighting differences in financial instruments and lease accounting Condensed Consolidated Statements of Operations GAAP to IFRS Reconciliation for the Six Months Ended June 30, 2025 | Indicator | GAAP Amount (RMB million) | Total IFRS Adjustments (RMB million) | IFRS Amount (RMB million) | | :--- | :--- | :--- | :--- | | Cost of Revenues | (553,254) | — | (553,254) | | Fulfillment Expenses | (41,882) | 877 | (41,007) | | Marketing Expenses | (37,556) | 2 | (37,554) | | Research and Development Expenses | (9,920) | 4 | (9,916) | | General and Administrative Expenses | (5,680) | 5 | (5,675) | | Gains from sale of development properties | 224 | (123) | 101 | | Operating Income | 9,674 | 763 | 10,437 | | Share of results of equity method investments | 3,402 | (270) | 3,132 | | Interest expense | (1,243) | (1,152) | (2,395) | | Other, net | 8,208 | 546 | 8,772 | | Fair value change of preference shares | — | (4) | (4) | | Profit before income tax | 20,041 | (99) | 19,942 | | Income tax (expense)/benefit | (2,053) | 164 | (1,889) | | Net Income | 17,988 | 65 | 18,053 | | Net Income Attributable to JD.com, Inc. ordinary shareholders | 17,068 | 17 | 17,085 | [Condensed Consolidated Balance Sheets Reconciliation](index=31&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20Reconciliation) This section lists the GAAP to IFRS reconciliation for consolidated balance sheets, focusing on asset, liability, and equity impacts from accounting differences Condensed Consolidated Balance Sheets GAAP to IFRS Reconciliation as of June 30, 2025 | Indicator | GAAP Amount (RMB million) | Total IFRS Adjustments (RMB million) | IFRS Amount (RMB million) | | :--- | :--- | :--- | :--- | | Property, equipment and software, net | 87,160 | (2,135) | 85,025 | | Land use rights, net | 37,173 | (1,155) | 36,018 | | Operating lease right-of-use assets | 27,454 | (1,305) | 26,149 | | Equity investments | 48,225 | (20,581) | 27,644 | | Available-for-sale securities and other investments | 61,397 | (1,906) | 59,491 | | Financial assets at fair value through profit or loss | — | 31,876 | 31,876 | | Financial assets at fair value through other comprehensive income | — | 237 | 237 | | Deferred tax assets | 2,881 | (228) | 2,653 | | **Total Assets** | **706,939** | **4,803** | **711,742** | | Accrued expenses and other liabilities | 45,481 | 3,785 | 49,266 | | Financial liabilities at fair value through profit or loss | — | 22,563 | 22,563 | | Unsecured senior notes | 24,712 | (2,604) | 22,108 | | Deferred tax liabilities | 8,388 | 582 | 8,970 | | **Total Liabilities** | **409,650** | **24,326** | **433,976** | | Total equity attributable to JD.com, Inc. shareholders | 227,160 | (7,810) | 219,350 | | Non-controlling interests | 70,129 | (11,719) | 58,410 | | **Total Equity** | **297,289** | **(19,529)** | **277,760** | [Reconciliation Notes](index=33&type=section&id=Reconciliation%20Notes) This section explains seven key GAAP to IFRS reconciliation differences, including financial instruments, fair value investments, lease accounting, and convertible notes - Financial instruments with special attributes: GAAP accounts for them as mezzanine equity or non-controlling interests, while IFRS classifies them as financial liabilities due to the unconditional right to avoid delivering cash[65](index=65&type=chunk) - Investments measured at fair value: GAAP uses cost less impairment for investments without readily determinable fair value, while IFRS classifies them as financial assets at fair value through profit or loss or OCI[66](index=66&type=chunk) - Lease accounting: GAAP records right-of-use asset amortization and interest expense together as lease expense, while IFRS amortizes right-of-use assets on a straight-line basis and measures interest expense at amortized cost separately[67](index=67&type=chunk) - Convertible preference notes: GAAP accounts for them entirely as debt, while IFRS treats them as hybrid instruments, separating and fair valuing embedded derivatives[70](index=70&type=chunk) - Investment in JD Technology: GAAP treats it as a common control transaction, while IFRS accounts for it as an acquisition of additional equity in an investee, with different accounting for redemption term modifications and fair value changes[72](index=72&type=chunk) Other Information [Conference Call Information](index=12&type=section&id=Conference%20Call%20Information) JD management will host a conference call on August 14, 2025, at 8:00 AM ET to discuss Q2 and interim financial results - The conference call will be held on **August 14, 2025, at 8:00 AM ET** (**8:00 PM Beijing/Hong Kong Time**)[35](index=35&type=chunk) - Pre-registration links and a telephone replay service are available, with the replay accessible for one week until August 21, 2025[35](index=35&type=chunk) [About JD.com](index=12&type=section&id=About%20JD.com) JD.com is a leading supply chain-based technology and service enterprise, offering "Retail as a Service" solutions to enhance industry productivity - JD.com is a leading supply chain-based technology and service enterprise[36](index=36&type=chunk) - The company offers **"Retail as a Service"** solutions, opening up its technology and infrastructure to enhance productivity and innovation across various industries[36](index=36&type=chunk) [Forward-Looking Statements](index=15&type=section&id=Forward-Looking%20Statements) This announcement contains forward-looking statements under the U.S. Private Securities Litigation Reform Act of 1995, involving inherent risks and uncertainties - This announcement contains forward-looking statements made under the **"safe harbor"** provisions of the U.S. Private Securities Litigation Reform Act of 1995[41](index=41&type=chunk) - Forward-looking statements concern business prospects, strategies, and operational plans, involving inherent risks and uncertainties that could cause actual results to differ materially from expectations[41](index=41&type=chunk) - The company undertakes no obligation to update any forward-looking statements, unless required by applicable law[41](index=41&type=chunk) [Contact Information](index=14&type=section&id=Contact%20Information) This section provides contact details for JD Group's investor relations and media inquiries for further information - Investor Relations contact: Shiyao Zhang, Phone: **+86 (10) 8912-6804**, Email: **IR@JD.com**[40](index=40&type=chunk) - Media contact: Phone: **+86 (10) 8911-6155**, Email: **Press@JD.com**[40](index=40&type=chunk)

香港交易及結算所有限公司及香港聯合交易所有限公司（「香港聯交所」）對本公告 的內容概不負責，對其準確性或完整性亦不發表任何聲明，並明確表示概不會就本公 告全部或任何部分內容而產生或因倚賴該等內容而引致的任何損失承擔任何責任。 NetEase, Inc. （於開曼群島註冊成立的有限責任公司） （股份代號：9999） 2025年 6月30日止第二季度未經審計的財務業績公告、 第二季度股息公告及中期報告 網易股份有限公司（「公司」）謹此公佈其截至2025年6月30日的三個月和六個月未經 審計的財務業績。本業績公告亦為根據香港聯交所上市規則第13.48（1）條的規定提 供予股東的2025年中期報告。本業績公告可於香港聯交所網站www.hkexnews.hk及公 司網站http://ir.netease.com閱覽。 網易公布 2025 年第二季度未經審計財務業績 中國杭州，2025 年 8 月 14 日-領先的互聯網與游戲服務提供商網易股份有限公司（納斯達克代 號：NTES 及港交所代號：9999，「網易」或「公司」），今天宣布了截至 2025 年 6 月 30 日 的第二季度未經審計財務業績。 承董事會命 NetE ...

Share Incentive Plan - The total number of shares available for issuance under the share incentive plan is 41,500,000, accounting for approximately 10% of the total issued shares as of March 27, 2025, which is 415,000,000 shares[2]

Financial and Business Summary [Summary of Financial Performance](index=3&type=section&id=摘要-财务业绩) For H1 2025, the Group's total revenue grew 4.0% to RMB 714 million, operating profit surged over 30 times to RMB 84.09 million, achieving a net profit of RMB 72.57 million, with period-end cash at RMB 940 million and no interim dividend recommended Key Financial Indicators for H1 2025 | Indicator | H1 2025 (RMB 10,000) | H1 2024 (RMB 10,000) | YoY Change | | :--- | :--- | :--- | :--- | | **Total Revenue** | 71,359 | 68,633 | +4.0% | | **Gross Profit** | 46,678 | 46,915 | -0.5% | | **Gross Profit Margin** | 65.4% | 68.4% | -3.0 p.p. | | **Operating Profit** | 8,409 | 259 | +3,151.7% | | **Profit/(Loss) for the Period** | 7,257 | (430) | Turnaround to Profit | | **Cash and Cash Equivalents (Period-end)** | 93,982 | - | - | - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025[7](index=7&type=chunk) [Business Segment Performance](index=3&type=section&id=摘要-业务分部表现) During the reporting period, merchant solutions business was the primary growth driver with a 10.3% increase in revenue, while subscription solutions revenue slightly decreased by 1.0%, with merchant solutions also achieving a 3.5% gross profit growth, contrasting with a 2.8% decline in subscription solutions gross profit Revenue and Gross Profit Performance by Business Segment | Business Segment | Revenue (RMB 100 million) | YoY Change | Gross Profit (RMB 100 million) | YoY Change | | :--- | :--- | :--- | :--- | :--- | | **Subscription Solutions** | 3.74 | -1.0% | 2.87 | -2.8% | | **Merchant Solutions** | 3.38 | +10.3% | 1.78 | +3.5% | Unaudited Condensed Consolidated Financial Statements [Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=5&type=section&id=未經審核簡明綜合損益及其他全面收益表) The Group achieved a turnaround to profit in H1 2025, reporting RMB 72.57 million in net profit, primarily due to effective cost control, reduced operating expenses, and a reversal of financial asset impairment losses Key Items from Statement of Profit or Loss (RMB thousand) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Revenue | 713,589 | 686,329 | | Gross Profit | 466,775 | 469,149 | | Selling and Distribution Expenses | (259,962) | (265,763) | | Administrative Expenses | (63,457) | (70,020) | | Research and Development Costs | (79,861) | (93,828) | | **Operating Profit** | **84,089** | **2,586** | | **Profit/(Loss) for the Period** | **72,569** | **(4,295)** | | Profit/(Loss) attributable to owners of the parent | 72,742 | (17,224) | | Basic Earnings/(Loss) Per Share (RMB) | 0.0023 | (0.0005) | [Consolidated Statement of Financial Position](index=7&type=section&id=未經審核簡明綜合財務狀況表) As of June 30, 2025, the Group's financial position remained robust with total assets of RMB 6.08 billion and net assets increasing to RMB 1.14 billion, demonstrating stable short-term solvency with a current ratio of 1.09 times Key Items from Statement of Financial Position (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Non-current Assets** | 1,408,728 | 1,412,490 | | **Total Current Assets** | 4,670,940 | 4,498,721 | | **Total Current Liabilities** | 4,283,227 | 4,144,146 | | **Total Non-current Liabilities** | 657,915 | 691,574 | | **Net Assets** | **1,138,526** | **1,075,491** | | Deposits with central banks | 3,351,375 | 3,127,657 | | Cash and cash equivalents | 939,816 | 888,821 | [Consolidated Statement of Cash Flows](index=11&type=section&id=未經審核簡明綜合現金流量報表) In H1 2025, the Group's operating cash flow significantly improved, turning from a net outflow to a net inflow of RMB 86.53 million, with period-end cash and cash equivalents increasing to RMB 940 million Summary of Cash Flow Statement (RMB thousand) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Net cash flows from/(used in) operating activities | 86,530 | (64,293) | | Net cash flows from/(used in) investing activities | 95 | (1,086) | | Net cash flows used in financing activities | (35,539) | (17,088) | | **Net increase/(decrease) in cash and cash equivalents** | **51,086** | **(82,467)** | | Cash and cash equivalents at end of period | 939,816 | 840,766 | Notes to the Financial Statements [Operating Segment Information](index=13&type=section&id=附註4.%20經營分部資料) The Group operates in third-party payment and merchant services segments, with merchant services contributing the majority of revenue in H1 2025, while third-party payment services demonstrated stronger profitability with a segment result of RMB 51.74 million Segment Results for H1 2025 (RMB thousand) | Segment | Sales to external customers | Segment result | | :--- | :--- | :--- | | Third-party payment services | 149,807 | 51,741 | | Merchant services | 560,277 | 41,278 | | Others | 3,505 | 3,560 | | **Total** | **713,589** | **96,579** | [Revenue Analysis](index=15&type=section&id=附註5.%20收益) The Group's total revenue is primarily from subscription and merchant solutions, with merchant solutions revenue growing 10.3% in H1 2025 as a key driver, while subscription solutions revenue slightly decreased, and most revenue originated from mainland China Revenue by Business Line (RMB thousand) | Business Line | H1 2025 | H1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Subscription solutions | 373,643 | 377,489 | (1.0) | | Merchant solutions | 338,211 | 306,639 | 10.3 | | Others | 1,735 | 2,201 | - | | **Total** | **713,589** | **686,329** | **4.0** | - Mainland China contributed **RMB 710 million** in revenue, accounting for **99.6%** of total revenue[24](index=24&type=chunk) Management Discussion and Analysis [Business Review](index=27&type=section&id=業務回顧) In H1 2025, Youzan integrated intelligent technologies to enhance merchant marketing and operations, with GMV reaching RMB 49.8 billion, store SaaS business contributing 51% of GMV, and average sales per existing paying merchant increasing by 11% - The company continues to integrate intelligent technologies with its solutions, launching various smart products focused on intelligent marketing, omnichannel management, and operational analysis to help merchants increase revenue and efficiency[48](index=48&type=chunk) Key Operating Data for H1 2025 | Indicator | Value | | :--- | :--- | | Gross Merchandise Volume (GMV) | Approx. RMB 49.8 billion | | Store SaaS Business GMV Share | Approx. 51% | | Average Sales Per Merchant | Approx. RMB 930,000 (YoY growth of 11%) | | Number of Existing Paying Merchants | 53,651 | | Number of New Paying Merchants | 8,583 | [Financial Review](index=29&type=section&id=財務回顧) The Group's H1 2025 financial performance was robust, with total revenue up 4.0% driven by merchant solutions, and despite higher cost of sales impacting gross margin, effective expense control led to significant operating profit growth and a net profit turnaround, with adjusted non-HKFRS profit increasing 59.0% [Revenue Analysis](index=29&type=section&id=財務回顧-收益) Total revenue increased by 4.0% to RMB 714 million, driven by a 10.3% growth in merchant solutions revenue due to logistics solution penetration, while subscription solutions revenue slightly decreased by 1.0% Revenue Breakdown (RMB thousand) | Business Segment | H1 2025 | H1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Subscription solutions | 373,643 | 377,489 | (1.0) | | Merchant solutions | 338,211 | 306,639 | 10.3 | | **Total** | **713,589** | **686,329** | **4.0** | - The growth in merchant solutions revenue was primarily due to increased penetration of logistics solutions, leading to a higher volume of orders utilizing Youzan's logistics solutions[59](index=59&type=chunk) [Cost of Sales and Gross Profit Analysis](index=31&type=section&id=財務回顧-銷售成本) Cost of sales increased by 13.6% to RMB 247 million, primarily due to higher logistics, transaction, and technical service expenses, resulting in a decrease in the Group's overall gross profit margin from 68.4% to 65.4% - Key drivers for the increase in cost of sales include a **69.0%** rise in logistics costs, a **9.6%** increase in transaction costs, and a **52.6%** increase in technical service expenses[62](index=62&type=chunk) Gross Profit Margin by Business Segment | Business Segment | H1 2025 Gross Profit Margin | H1 2024 Gross Profit Margin | | :--- | :--- | :--- | | Subscription solutions | 76.9% | 78.3% | | Merchant solutions | 52.7% | 56.2% | | **Total** | **65.4%** | **68.4%** | [Analysis of Expenses and Other Items](index=33&type=section&id=財務回顧-費用和其他) The Group effectively controlled expenses, with selling and distribution, administrative, and R&D costs decreasing by 2.2%, 9.4%, and 14.9% respectively, largely due to the adoption of AI-driven tools reducing R&D labor costs - Selling and distribution expenses decreased by **2.2%**, primarily due to reduced channel commission expenses[68](index=68&type=chunk) - Administrative expenses decreased by **9.4%**, mainly attributable to reduced staff costs due to a decrease in administrative and back-office personnel[68](index=68&type=chunk) - Research and development costs decreased by **14.9%**, primarily due to the widespread adoption of AI-driven tools in R&D activities, leading to lower R&D staff costs[68](index=68&type=chunk) [Non-HKFRS Measures](index=34&type=section&id=非香港財務報告準則計量) Under non-HKFRS measures, adjusted profit for the period increased 59.0% to RMB 82.36 million, and adjusted EBITDA rose 94.6% to RMB 70.20 million, primarily excluding non-cash items like share-based payments and intangible asset amortization Non-HKFRS Profit Reconciliation (RMB thousand) | Item | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Profit/(Loss) for the period | 72,569 | (4,295) | | Add: Equity-settled share-based payments | 9,822 | 21,704 | | Add: Amortization of intangible assets | – | 40,467 | | Less: Related tax adjustments | (34) | (6,070) | | **Adjusted non-HKFRS profit for the period** | **82,357** | **51,806** | [Financial Resources and Liquidity](index=36&type=section&id=財務資源及流動資金) As of June 30, 2025, the Group maintained a robust financial position with approximately RMB 940 million in cash and cash equivalents, and a stable debt-to-asset ratio of 5.7%, consistent with year-end 2024 Key Liquidity Data (RMB thousand) | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | 939,816 | 888,821 | | Bank and other borrowings | 345,291 | 338,725 | - As of June 30, 2025, the Group's debt-to-asset ratio was **5.7%**, remaining relatively stable compared to **5.7%** as of December 31, 2024[74](index=74&type=chunk) Other Disclosures [Share Repurchases](index=44&type=section&id=購買、出售或贖回本公司的上市證券) For H1 2025, the company repurchased 257,868,000 shares on the Stock Exchange for approximately HKD 23.79 million, reflecting the Board's confidence in business prospects and commitment to shareholder value Share Repurchase Details for H1 2025 | Month of Repurchase | Number of Shares Repurchased | Total Consideration (HKD thousand) | | :--- | :--- | :--- | | January 2025 | 4,000,000 | 428 | | March 2025 | 59,888,000 | 6,084 | | April 2025 | 136,392,000 | 11,945 | | May 2025 | 40,588,000 | 3,721 | | June 2025 | 17,000,000 | 1,613 | | **Total** | **257,868,000** | **23,791** | [Corporate Governance](index=45&type=section&id=企業管治守則) The company largely complied with the Corporate Governance Code, with one deviation: the Chairman and CEO roles are held by Mr. Zhu Ning, an arrangement the Board deems in the best interest of the company and shareholders due to his leadership and business understanding - The company deviated from the Corporate Governance Code's provision that the roles of Chairman and Chief Executive Officer should be held by different individuals, as Mr. Zhu Ning, the Executive Director and Chief Executive Officer, also serves as the Chairman of the Board[103](index=103&type=chunk)[104](index=104&type=chunk) - The Board believes Mr. Zhu Ning is the most suitable person for both positions, and this arrangement is beneficial to the company and its shareholders and is in their overall best interests[105](index=105&type=chunk)

[Financial Summary](index=1&type=section&id=Performance) [Consolidated Income Statement](index=1&type=section&id=Interim%20Condensed%20Consolidated%20Income%20Statement) For the six months ended June 30, 2025, the Group's turnover decreased by 19.2% to HK$487 million, resulting in an operating loss of HK$14.15 million from a profit of HK$55.92 million last year, and a loss attributable to owners of HK$3.96 million Key Interim Performance Indicators | Indicator | For the six months ended June 30, 2025 (HK$ Thousand) | For the six months ended June 30, 2024 (HK$ Thousand) | Year-on-year Change | | :--- | :--- | :--- | :--- | | Turnover | 487,111 | 603,261 | -19.2% | | Gross Profit | 288,954 | 361,871 | -20.1% | | Operating (Loss) / Profit | (14,148) | 55,924 | N/A (Turned to Loss) | | (Loss) / Profit Attributable to Owners of the Company | (3,960) | 58,233 | N/A (Turned to Loss) | | Basic (Loss) / Earnings Per Share (HK Cents) | (0.41) | 5.98 | N/A (Turned to Loss) | [Consolidated Statement of Comprehensive Income](index=2&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Comprehensive%20Income) Despite an operating loss, total comprehensive income for the period significantly improved to HK$86.2 million, from a loss of HK$8.76 million last year, primarily due to positive exchange differences from RMB appreciation Changes in Comprehensive Income | Item (HK$ Thousand) | For the six months ended June 30, 2025 | For the six months ended June 30, 2024 | | :--- | :--- | :--- | | (Loss) / Profit for the Period | (3,944) | 58,240 | | Exchange Differences | 76,651 | (74,436) | | **Total Comprehensive Income for the Period** | **86,201** | **(8,760)** | [Consolidated Statement of Financial Position](index=3&type=section&id=Interim%20Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2025, the Group maintained a robust financial position with total assets of HK$5.24 billion and total equity of HK$4.44 billion, with investment properties being the largest non-current asset Balance Sheet Summary (As at Period End) | Indicator (HK$ Thousand) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Assets | 5,242,929 | 5,146,477 | | Total Liabilities | 807,445 | 797,194 | | Total Equity | 4,435,484 | 4,349,283 | | Investment Properties | 2,658,006 | 2,604,529 | | Bank Balances and Cash | 1,131,027 | 1,050,536 | [Notes to the Financial Statements](index=4&type=section&id=Notes) [Significant Accounting Policies](index=4&type=section&id=1.%20Significant%20Accounting%20Policies) The interim financial information is prepared in accordance with HKAS 34, with consistent accounting policies, and new standards are not expected to have a material impact - Financial information is prepared in accordance with HKAS 34, with accounting policies consistent with annual statements[6](index=6&type=chunk)[7](index=7&type=chunk) [Turnover and Segment Information](index=6&type=section&id=2.%20Turnover%20and%20Segment%20Information) Group turnover declined by 19.2%, with China and Hong Kong apparel business revenue down 24.1% and turning to loss, while property investment and development revenue slightly decreased Segment Turnover and Results (For the six months ended June 30) | Operating Segment (HK$ Thousand) | 2025 Turnover | 2024 Turnover | 2025 Segment Results | 2024 Segment Results | | :--- | :--- | :--- | :--- | :--- | | China and Hong Kong Apparel Business | 350,101 | 461,487 | (16,333) | 46,904 | | Singapore Apparel Business | 17,081 | 18,535 | (3,461) | (2,337) | | Property Investment and Development | 125,494 | 129,043 | 31,223 | 41,185 | Turnover by Revenue Source (For the six months ended June 30) | Revenue Source (HK$ Thousand) | 2025 | 2024 | | :--- | :--- | :--- | | Sale of Goods | 335,005 | 439,332 | | Sale of Properties | 27,987 | 28,334 | | Rental Income from Investment Properties | 72,002 | 74,299 | [Other Financial Notes](index=8&type=section&id=Other%20Financial%20Notes) Investment property fair value loss expanded to HK$22.95 million, income tax expense significantly decreased, and the interim dividend was halved to 1.0 HK cents per share - Investment property fair value loss was **HK$22.95 million**, compared to HK$19.82 million in the prior period[12](index=12&type=chunk) - The Board recommended an interim dividend of **1.0 HK cents per share**, a 50% year-on-year decrease[17](index=17&type=chunk)[20](index=20&type=chunk) - Net trade receivables decreased from **HK$88.67 million** at the beginning of the year to **HK$52.37 million**[18](index=18&type=chunk) [Management Discussion and Analysis](index=11&type=section&id=Operating%20Results) [Operating Results Analysis](index=11&type=section&id=Operating%20Results) Under macroeconomic uncertainties, the Group's H1 2025 performance was pressured, with turnover down 19%, resulting in an operating loss of HK$14.15 million and a 79% adjusted profit decline - Total turnover was **HK$487 million**, a **19% year-on-year decrease**, primarily due to revenue declines across all major businesses[21](index=21&type=chunk) - The Group recorded an operating loss of **HK$14.15 million** for the period, compared to an operating profit of HK$55.92 million in the prior period[26](index=26&type=chunk) - Excluding the after-tax net loss from fair value changes of investment properties, profit for the period was **HK$15.58 million**, a year-on-year decrease of approximately **79%**[27](index=27&type=chunk) [Business Review](index=12&type=section&id=Business%20Review) All core businesses faced challenges, with China apparel revenue down 24% due to market competition, property investment rental income down 3% from rising vacancies, and slow property development inventory clearance [Apparel Business](index=12&type=section&id=Apparel%20Business) China and Hong Kong apparel business revenue fell 24%, with wholesale sales halved and retail/e-commerce also declining, while Singapore sales dropped 11% in local currency, widening losses - China apparel business recorded a total turnover of **HK$318 million**, a year-on-year decrease of approximately **24%**[28](index=28&type=chunk) - Domestic key channel sales performance: * Wholesale sales: **down 50%** * Self-operated retail: **same-store sales down 12%** * Outlets: **sales down approximately 30%** * E-commerce business: **sales down approximately 14%**[28](index=28&type=chunk)[29](index=29&type=chunk) - Singapore apparel sales were **HK$17.08 million**, a year-on-year decrease of approximately **8%** (11% in local currency), with business losses widening[31](index=31&type=chunk) [Property Investment and Development](index=14&type=section&id=Property%20Investment%20and%20Development) The property investment market faced a severe environment, with total rental and property management income down 3%, Guangzhou's "Goldlion Digital Network Tower" occupancy rate falling to 77%, and slow sales for the Meixian "Goldlion Garden" project - Total rental and property management income for the period decreased by approximately **3%** year-on-year, mainly due to increased vacancy rates in some properties[32](index=32&type=chunk) - Guangzhou's "Goldlion Digital Network Tower" occupancy rate decreased to **77%**, and Shenyang's "Goldlion Commercial Building" revenue fell **17%** due to rent concessions[33](index=33&type=chunk) - Only **34 units** of the Meixian "Goldlion Garden" property development project were sold during the period, with a significant number of units remaining for sale[33](index=33&type=chunk) [Outlook](index=14&type=section&id=Outlook) The Group anticipates continued challenging operating conditions in H2 2025, with strategies including optimizing domestic apparel, integrating distribution, enhancing Singapore operations, and launching a snooker apparel series - The operating environment in H2 2025 is expected to remain challenging, with slow recovery in domestic consumer confidence and a difficult operational outlook[35](index=35&type=chunk) - The Group plans to launch a snooker apparel series, promoting it through event and player sponsorships[36](index=36&type=chunk) - The property investment business will focus on improving property leasing and flexibly selling the remaining units of Meixian "Goldlion Garden"[36](index=36&type=chunk) [Financial Position](index=15&type=section&id=Financial%20Position) The Group's financial position is exceptionally robust, with approximately HK$1.13 billion in cash, zero bank loans, a zero debt-to-asset ratio, and a high current ratio of 6.1 Key Financial Position Indicators (As at June 30, 2025) | Indicator | Value | | :--- | :--- | | Cash and Bank Balances | HK$1.13 billion | | Bank Loans and Overdrafts | Zero | | Debt-to-Asset Ratio | Zero | | Current Ratio | 6.1 | [Other Information](index=15&type=section&id=Other%20Information) [Dividends and Shares](index=10&type=section&id=Interim%20Dividend) The Board recommended an interim dividend of 1.0 HK cents per share, totaling HK$9.74 million, to be paid on September 17, 2025, with no share repurchases or sales during the period - Proposed interim dividend of **1.0 HK cents per share** (2024: 2.0 HK cents), totaling **HK$9.74 million**[20](index=20&type=chunk) - The Company did not conduct any share repurchases or sales during the period[41](index=41&type=chunk) [Human Resources](index=16&type=section&id=Human%20Resources) As of June 30, 2025, the Group employed approximately 1,600 staff, with total staff costs, including directors' emoluments, amounting to HK$111 million, largely consistent with the prior period Human Resources Data | Indicator | Value | | :--- | :--- | | Total Staff (As at June 30, 2025) | Approximately 1,600 persons | | Six-month Staff Costs (HK$ Thousand) | 111,454 | [Corporate Governance and Audit](index=16&type=section&id=Corporate%20Governance) The Company complied with the Listing Rules' Corporate Governance Code, with the Chairman and CEO roles combined for effective leadership, and both the Audit Committee and external auditors reviewed the interim financial information - The Company has complied with the provisions of the Corporate Governance Code[42](index=42&type=chunk) - Both the Audit Committee and external auditors have reviewed the interim financial information[43](index=43&type=chunk)[44](index=44&type=chunk)