中国再生医学(08158) - 2024 - 中期业绩

Corporate Information The company's board comprises executive, non-executive, and independent non-executive directors, with Mr. Wang Chuang serving as Chairman and CEO Directors and Company Secretary The board consists of executive, non-executive, and independent non-executive directors, with Mr. Wang Chuang as Chairman and CEO; Mr. Tsang Ho Yin resigned as non-executive director, and Mr. Wong Po Tin was appointed company secretary - Mr. Wang Chuang serves as Chairman and Chief Executive Officer, also acting as Compliance Officer and Authorised Representative[5][6] - Mr. Tsang Ho Yin resigned as a non-executive director on August 20, 2024[5] - Mr. Wong Po Tin was appointed Company Secretary and Authorised Representative on July 2, 2024, with Mr. Yau Woon Fat resigning on the same day[5][6] Committees The company has Nomination, Remuneration, and Audit Committees to ensure effective corporate governance, chaired by Dr. Liu Ming and Mr. Leung Man Fai respectively - The Nomination Committee is chaired by Dr. Liu Ming, with members Mr. Leung Man Fai and Ms. Fok Chun Yuk[5] - The Remuneration Committee is chaired by Dr. Liu Ming, with members Ms. Fok Chun Yuk and Mr. Leung Man Fai; Mr. Tsang Ho Yin resigned on August 20, 2024[5] - The Audit Committee is chaired by Mr. Leung Man Fai, with members Dr. Liu Ming and Ms. Fok Chun Yuk[5] Key Offices and Advisors The company is registered in the Cayman Islands with its principal Hong Kong office in Tsim Sha Tsui, engaging HSBC as a primary bank and Zhongzheng Tianheng CPA as auditor - The company's registered office is in the Cayman Islands, and its principal place of business in Hong Kong is located in Miramar Tower, Tsim Sha Tsui, Kowloon[6] - Principal bankers include The Hongkong and Shanghai Banking Corporation Limited, Hang Seng Bank Limited, Dah Sing Bank, Limited, Hua Xia Bank, and Jiangnan Rural Commercial Bank[6] - The auditor is Zhongzheng Tianheng CPA Limited, and legal advisors include Conyers Dill & Pearman (Cayman Islands law) and Yau Woon Fat & Co. (Hong Kong law)[6][7] Condensed Consolidated Financial Statements The condensed consolidated financial statements provide a summary of the company's financial performance and position for the period Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended June 30, 2024, revenue decreased by 19.44% to HKD 59,785 thousand, but gross profit increased by 29.53% to HKD 39,490 thousand, with profit for the period rising 31.86% to HKD 16,828 thousand Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (For the six months ended June 30) | Indicator | 2024 (HKD thousand) | 2023 (HKD thousand) (Restated) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 59,785 | 74,216 | -19.44% | | Cost of sales | (20,295) | (43,729) | -53.60% | | Gross profit | 39,490 | 30,487 | +29.53% | | Other income, gains and losses | 83 | 20 | +315.00% | | Selling and distribution expenses | (3,116) | (3,352) | -7.04% | | Administrative and other expenses | (18,991) | (15,725) | +20.77% | | Finance costs | (638) | (540) | +18.15% | | Profit before tax | 16,828 | 10,890 | +54.53% | | Income tax credit | – | 1,872 | -100.00% | | Profit for the period | 16,828 | 12,762 | +31.86% | | Other comprehensive expenses | (3,486) | (5,037) | -30.80% | | Total comprehensive income for the period | 13,342 | 7,725 | +72.72% | | Basic earnings per share (HK cents) | 5.53 | 4.47 | +23.71% | | Diluted earnings per share (HK cents) | 5.53 | 4.47 | +23.71% | - The decrease in revenue was primarily due to the absence of the retaliatory consumption by mainland Chinese customers in 2024, which occurred in 2023 after the lifting of anti-epidemic measures[83] - The increase in gross profit was mainly attributable to a significant decrease in cost of sales[9] Condensed Consolidated Statement of Financial Position As of June 30, 2024, net current assets and total equity increased, driven by the profit for the period, with total current assets at HKD 132,869 thousand and net current assets at HKD 34,656 thousand Condensed Consolidated Statement of Financial Position (As of June 30) | Indicator | June 30, 2024 (HKD thousand) | December 31, 2023 (HKD thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Non-current assets | | | | | Property, plant and equipment | 2,995 | 2,873 | +4.25% | | Right-of-use assets | 9,210 | 14,445 | -36.11% | | Current assets | | | | | Inventories | 296 | 445 | -33.50% | | Trade receivables | 1,551 | 1,196 | +29.68% | | Deposits, prepayments and other receivables | 129,175 | 163,604 | -21.05% | | Cash and bank balances | 1,847 | 3,334 | -44.59% | | Current liabilities | | | | | Trade payables | 5,512 | 2,473 | +122.97% | | Accruals and other payables | 19,510 | 14,910 | +30.85% | | Contract liabilities | 18,908 | 81,090 | -76.68% | | Lease liabilities | 9,667 | 10,395 | -7.00% | | Shareholder loans | 19,633 | 13,629 | +44.06% | | Current tax liabilities | 24,983 | 25,293 | -1.23% | | Net current assets | 34,656 | 20,789 | +66.70% | | Total equity | 25,135 | 11,793 | +113.13% | - The increase in net current assets and total equity was primarily attributable to the operating profit of approximately HKD 16.83 million for the six months ended June 30, 2024[84] Condensed Consolidated Statement of Changes in Equity Total equity increased from HKD 11,733 thousand to HKD 25,135 thousand for the six months ended June 30, 2024, primarily due to profit for the period, partially offset by exchange losses Condensed Consolidated Statement of Changes in Equity (For the six months ended June 30) | Indicator | January 1, 2024 (HKD thousand) | Profit for the period (HKD thousand) | Other comprehensive expenses (HKD thousand) | June 30, 2024 (HKD thousand) | | :--- | :--- | :--- | :--- | :--- | | Share capital | 60,850 | – | – | 60,850 | | Share premium | 3,215,749 | – | – | 3,215,749 | | Exchange reserve | (11,188) | – | (3,486) | (14,675) | | Special reserve | (200) | – | – | (200) | | Other reserves | (413,100) | – | – | (413,100) | | Share option reserve | 40,609 | – | – | 40,609 | | Accumulated losses | (2,880,926) | 16,828 | – | (2,864,098) | | Total equity | 11,793 | 16,828 | (3,486) | 25,135 | - Profit for the period of HKD 16,828 thousand was the main contributor to the growth in total equity[23] - Exchange losses had a negative impact on total equity, amounting to HKD 3,486 thousand during the period[23] Condensed Consolidated Statement of Cash Flows For the six months ended June 30, 2024, the company reported net cash outflow from operating activities of HKD 151 thousand and investing activities of HKD 529 thousand, offset by net cash inflow from financing activities of HKD 364 thousand Condensed Consolidated Statement of Cash Flows (For the six months ended June 30) | Indicator | 2024 (HKD thousand) | 2023 (HKD thousand) | | :--- | :--- | :--- | | Net cash (used in) / generated from operating activities | (151) | 79 | | Net cash used in investing activities | (529) | (110) | | Net cash generated from / (used in) financing activities | 364 | (1,942) | | Net decrease in cash and cash equivalents | (316) | (1,973) | | Effect of foreign exchange rate changes, net | (1,171) | 933 | | Cash and cash equivalents at beginning of period | 3,334 | 1,849 | | Cash and cash equivalents at end of period | 1,847 | 809 | - Operating activities shifted from net inflow to net outflow, reflecting pressure on operating cash flow[27] - Cash flow from financing activities changed from net outflow to net inflow, likely related to an increase in shareholder loans[27][84] Notes to the Condensed Consolidated Financial Statements These notes provide detailed explanations and disclosures supporting the condensed consolidated financial statements, covering accounting policies, segment information, and financial instrument details 1. General Information The company, incorporated in the Cayman Islands, primarily engages in investment holding, with subsidiaries providing aesthetic medical, beauty, and medical services, and its financial statements are presented in HKD - The company's principal business is investment holding, with subsidiaries providing aesthetic medical and beauty services and medical services[28] - The financial statements are presented in Hong Kong Dollars, consistent with the Group's functional currency[28] 2. Basis of Preparation Interim financial statements are prepared in accordance with HKAS 34 and GEM Listing Rules, reviewed by the Audit Committee, and include a restatement of 2023 comparatives for revenue recognition - The interim financial statements are prepared in accordance with Hong Kong Accounting Standard 34 and the GEM Listing Rules, and have been reviewed by the Audit Committee[28][29] - The comparative financial statements for 2023 were restated due to an adjustment in the recognition method for agency business revenue, changing from a gross basis to a net basis, resulting in a HKD 25,875 thousand reduction in both 2023 revenue and cost of sales[29][31] - The restatement had no impact on 2023 basic and diluted earnings per share or accumulated losses[33] - The agency business ceased operations in May 2023 and made no contribution to the Group in the first half of 2024[32] 3. Revenue and Other Income, Gain and Loss For the six months ended June 30, 2024, the group's revenue primarily derived from services, with significant shifts between point-in-time and over-time recognition, and other income included bank interest and government grants Revenue Composition (For the six months ended June 30) | Revenue Recognition Method | 2024 (HKD thousand) | 2023 (HKD thousand) (Restated) | | :--- | :--- | :--- | | At a point in time | 25,742 | 3,291 | | Over time | 34,043 | 70,925 | | Total Revenue | 59,785 | 74,216 | Other Income, Gains and Losses (For the six months ended June 30) | Item | 2024 (HKD thousand) | 2023 (HKD thousand) | | :--- | :--- | :--- | | Bank interest income | 3 | 9 | | Government grants | 36 | – | | Gain on disposal of property, plant and equipment | – | 1 | | Others | 44 | 10 | | Total | 83 | 20 | - Point-in-time revenue recognition significantly increased in 2024, while over-time revenue recognition substantially decreased[38] 4. Segment Information The group operates in aesthetic medical and beauty services and medical services, with the former contributing most revenue and profit, and revenue primarily generated from Hong Kong - The Group's operating segments include aesthetic medical and beauty services and medical services[40][42] Segment Revenue and Results (For the six months ended June 30) | Segment | 2024 Revenue (HKD thousand) | 2024 Segment Profit/(Loss) (HKD thousand) | 2023 Revenue (HKD thousand) (Restated) | 2023 Segment Profit (HKD thousand) | | :--- | :--- | :--- | :--- | :--- | | Aesthetic medical and beauty services | 56,799 | 28,844 | 70,655 | 29,028 | | Medical services | 2,986 | (1,872) | 3,561 | 1,316 | | Total | 59,785 | 26,972 | 74,216 | 30,344 | - In 2024, revenue from aesthetic medical and beauty services decreased year-on-year, but segment profit remained stable; medical services saw a decline in both revenue and profit, turning into a loss[45][46] Revenue by Geographical Location (For the six months ended June 30) | Geographical Location | 2024 (HKD thousand) | 2023 (HKD thousand) (Restated) | | :--- | :--- | :--- | | Hong Kong | 59,368 | 74,216 | | China | 417 | – | | Total | 59,785 | 74,216 | - In 2024, the China region began contributing revenue, while revenue from the Hong Kong region decreased[52] 5. Finance Costs For the six months ended June 30, 2024, total finance costs were HKD 638 thousand, mainly comprising interest on lease liabilities and a new item of interest on shareholder loans Finance Costs (For the six months ended June 30) | Item | 2024 (HKD thousand) | 2023 (HKD thousand) | | :--- | :--- | :--- | | Interest on lease liabilities | 314 | 540 | | Interest on shareholder loans | 324 | – | | Total | 638 | 540 | - New interest on shareholder loans amounted to HKD 324 thousand in 2024, arising from an unsecured shareholder loan of HKD 21,579 thousand with an annual interest rate of 3%[54][55] 6. Profit Before Tax For the six months ended June 30, 2024, profit before tax was determined after deducting depreciation, advertising, cost of inventories sold, and significantly increased employee benefit expenses Profit Before Tax Deductions (For the six months ended June 30) | Item | 2024 (HKD thousand) | 2023 (HKD thousand) (Restated) | | :--- | :--- | :--- | | Depreciation of property, plant and equipment | 410 | 278 | | Depreciation of right-of-use assets | 5,235 | 5,432 | | Advertising and marketing expenses | 548 | 745 | | Cost of inventories sold | 4,757 | 3,838 | | Employee benefit expenses | 8,353 | 6,060 | - Employee benefit expenses increased by 37.84% year-on-year, primarily due to the Group commencing operations in China in June 2023, leading to higher staff costs[56][83] 7. Income Tax Credit For the six months ended June 30, 2024, no provision was made for Hong Kong profits tax or PRC enterprise income tax due to sufficient tax losses and no assessable profits respectively Income Tax Credit (For the six months ended June 30) | Item | 2024 (HKD thousand) | 2023 (HKD thousand) | | :--- | :--- | :--- | | Current tax | – | – | | Deferred tax expense | – | 1,872 | | Total | – | 1,872 | - No provision was made for Hong Kong profits tax as there were sufficient tax losses available to offset assessable profits[60][63] - No provision was made for PRC enterprise income tax as no assessable profits were generated during the period[59][63] 8. Dividends The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2024, consistent with the prior year - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2024 (2023: nil)[61][64] 9. Earnings Per Share For the six months ended June 30, 2024, basic earnings per share increased to 5.53 HK cents, with diluted earnings per share being identical due to non-dilutive share options Earnings Per Share (For the six months ended June 30) | Indicator | 2024 (HK cents) | 2023 (HK cents) | | :--- | :--- | :--- | | Basic earnings per share | 5.53 | 4.47 | | Diluted earnings per share | 5.53 | 4.47 | Earnings Per Share Calculation Data (For the six months ended June 30) | Indicator | 2024 (HKD thousand/thousand shares) | 2023 (HKD thousand/thousand shares) | | :--- | :--- | :--- | | Profit attributable to equity holders of the Company | 16,828 | 12,762 | | Weighted average number of ordinary shares in issue | 304,252 | 285,429 | - Diluted earnings per share are the same as basic earnings per share because the exercise price of share options was higher than the average market price of shares, and there were no other potential dilutive ordinary shares[67][69] - On September 6, 2023, the company effected a share consolidation of ten shares into one, and comparative figures have been restated accordingly[68][69] 10. Trade Receivables, Deposits, Prepayments and Other Receivables As of June 30, 2024, trade receivables increased to HKD 1,551 thousand, while deposits, prepayments, and other receivables decreased to HKD 129,175 thousand, with most trade receivables due within 90 days Trade Receivables, Deposits, Prepayments and Other Receivables (As of June 30) | Item | June 30, 2024 (HKD thousand) | December 31, 2023 (HKD thousand) | | :--- | :--- | :--- | | Trade receivables | 1,551 | 1,196 | | Lease deposits | 5,657 | 5,657 | | Other deposits | 888 | 1,328 | | Prepayments | 96 | 189 | | Other receivables (net of recognised impairment losses) | 122,534 | 156,430 | | Total | 129,175 | 163,604 | Ageing Analysis of Trade Receivables (As of June 30) | Ageing | June 30, 2024 (HKD thousand) | December 31, 2023 (HKD thousand) | | :--- | :--- | :--- | | 0–90 days | 1,403 | 646 | | 91–180 days | 3 | 235 | | 181–270 days | 143 | 310 | | 271–360 days | – | – | | Over 360 days | 2 | 5 | | Total | 1,551 | 1,196 | - The average credit period granted to customers by the Group is 60-180 days, consistent with the prior year[73] 11. Trade Payables As of June 30, 2024, trade payables significantly increased to HKD 5,512 thousand, primarily due within 90 days, with an average credit period of 30-60 days from suppliers Ageing Analysis of Trade Payables (As of June 30) | Ageing | June 30, 2024 (HKD thousand) | December 31, 2023 (HKD thousand) | | :--- | :--- | :--- | | 0–30 days | 2,446 | 2,099 | | 31–60 days | 1,226 | 374 | | 61–90 days | 1,667 | – | | 91–120 days | – | – | | 121–150 days | 173 | – | | Total | 5,512 | 2,473 | - Trade payables increased by 122.97% year-on-year, primarily concentrated within 0-90 days[74] - The average credit period granted by suppliers to the Group is 30-60 days, consistent with the prior year[74] 12. Share Capital As of June 30, 2024, the company's authorized share capital was 500,000,000 ordinary shares of HKD 0.20 each, with 304,252,480 shares issued and fully paid, totaling HKD 60,850 thousand Share Capital Information (As of June 30) | Item | Number of Shares | Par Value (HKD thousand) | | :--- | :--- | :--- | | Authorised share capital (ordinary shares of HKD 0.20 each) | 500,000,000 | 100,000 | | Issued and fully paid share capital (ordinary shares of HKD 0.20 each) | 304,252,480 | 60,850 | - The share capital structure remained stable during the reporting period, with no new issues[75] 13. Related Party Transactions For the six months ended June 30, 2024, total remuneration for key management personnel decreased to HKD 609 thousand compared to the prior year Key Management Personnel Remuneration (For the six months ended June 30) | Item | 2024 (HKD thousand) | 2023 (HKD thousand) | | :--- | :--- | :--- | | Salaries and other benefits | 600 | 1,000 | | Contributions to retirement benefit schemes | 9 | 15 | | Total | 609 | 1,015 | - Key management personnel remuneration decreased by 39.90% year-on-year[78] 14. Events After the Reporting Period No significant events occurred after the reporting period up to the date of this report - No significant events occurred after the reporting period up to the date of this report[80][81] Management Discussion and Analysis This section reviews the company's business performance, financial results, and future outlook, highlighting key operational and financial trends and strategic initiatives Business Review and Future Prospect In H1 2024, Hong Kong's commercial activity improved but retail market shrank due to changing consumption patterns, impacting the group's stable business growth, with future plans to expand healthcare and reallocate resources - After the lifting of anti-epidemic measures, commercial activities in Hong Kong improved, but the retail market contracted due to changing consumption patterns (Hong Kong residents preferring mainland consumption), affecting the Group's business development[82] - The Group's customer base primarily originates from mainland China, but economic challenges in China may limit customer purchasing power and willingness to spend[82] - The Group's business focuses on medical and aesthetic medical services for mainland visitors to Hong Kong, with plans to continuously evaluate business operations and development directions to provide more comprehensive solutions[82] - Future plans include striving to expand the scope of business in the healthcare industry and reallocating resources as appropriate to maintain a leading position[83] Financial Review For the six months ended June 30, 2024, revenue decreased by 19.44% to HKD 59.78 million, but gross profit increased by 29.53% to HKD 39.49 million, with profit for the period rising to HKD 16.83 million, improving liquidity and reducing the gearing ratio Key Financial Performance (For the six months ended June 30) | Indicator | 2024 (HKD million) | 2023 (HKD million) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 59.78 | 74.22 | -19.44% | | Gross profit | 39.49 | 30.49 | +29.53% | | Profit for the period | 16.83 | 10.89 | +54.55% | | Total operating expenses | 22.11 | 19.08 | +15.88% | - The decrease in revenue was primarily due to the absence of the retaliatory consumption effect from mainland Chinese customers in 2024, which was present in 2023[83] - The 15.88% increase in operating expenses was mainly due to the Group commencing operations in China in June 2023, leading to higher staff costs[83] Asset and Liability Status (As of June 30) | Indicator | June 30, 2024 (HKD million) | December 31, 2023 (HKD million) | Change (%) | | :--- | :--- | :--- | :--- | | Net current assets | 34.66 | 20.79 | +66.71% | | Net assets | 25.14 | 11.79 | +113.23% | | Cash and bank balances | 1.85 | 3.33 | -44.59% | | Current assets | 132.87 | 168.58 | -21.29% | | Current liabilities | 98.21 | 147.79 | -33.54% | | Working capital ratio | 1.35 | 1.14 | +18.42% | | Shareholder loans | 41.21 | 35.21 | +17.04% | | Gearing ratio (Shareholder loans/Total equity) | 1.64 | 2.99 | -45.15% | - The Group primarily funds its operations through internal cash flow and shareholder loans[84] - The Group's foreign exchange risk is manageable, and it will continue to monitor and implement hedging measures as appropriate[85] Details of Future Plans for Material Investment or Capital Assets The company plans to inject RMB 10,250,000 into Changzhou Bomei Biotechnology Co., Ltd. through a wholly-owned subsidiary to acquire approximately 33.3% equity, with the transaction still under negotiation - Zhongzaisheng (Hong Kong) Health Technology Co., Limited plans to inject RMB 10,250,000 (approximately HKD 11,172,500) into Changzhou Bomei Biotechnology Co., Ltd., with RMB 250,000 for increasing registered capital and RMB 10,000,000 for capital reserve[88] - Upon completion, Zhongzaisheng Health will hold approximately 33.3% equity in the target company; this transaction is still under negotiation[88] - Other than the aforementioned disclosure, as of June 30, 2024, the Group had no other specific future plans for material investments or capital assets[88] Dividend The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2024 - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2024 (2023: nil)[88] Employee Information and Remuneration Policy As of June 30, 2024, the group had 39 employees, primarily in Hong Kong and mainland China, with total employee remuneration of HKD 8.35 million, and compensation based on individual performance and experience Employee Information (As of June 30) | Indicator | June 30, 2024 | June 30, 2023 | | :--- | :--- | :--- | | Total number of employees | 39 | 29 | | Total employee remuneration (HKD million) | 8.35 | 6.06 | - The increase in employee numbers was primarily due to the Group commencing operations in China in June 2023[89][90] - Remuneration and bonus policies are determined based on individual employee performance and experience[89][90] Other Information This section provides additional disclosures including directors' and substantial shareholders' interests, share option schemes, corporate governance practices, and other statutory information Directors and Chief Executives' Interests and Short Positions in Shares and Underlying Shares As of June 30, 2024, Executive Director Mr. Wang Chuang held a long position of 73,875,530 shares, representing 24.28% of the issued share capital, with no other directors holding disclosable interests Directors and Chief Executives' Long Positions in Shares and Underlying Shares | Name | Capacity | Total Long Position | Approximate Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | | Wang Chuang | Beneficial owner | 73,875,530 | 24.28% | - Save for Mr. Wang Chuang, as of June 30, 2024, no other directors or chief executives had any disclosable interests or short positions in the shares, underlying shares, or debentures of the company[94] Substantial Shareholders and Other Persons' Interests in Shares and Underlying Shares As of June 30, 2024, substantial shareholders included Quan Hui Holdings Limited and its associates (Mr. Dai Yu Min, Mr. Li Ren), China Orient Asset Management Co., Ltd. and its associates, and Changzhou Yaoguang Enterprise Management Consulting Partnership (Limited Partnership) and Changzhou Zhongmin Xingkong Enterprise Management Consulting Service Partnership (Limited Partnership) and their associates, all holding long positions in the company's shares Substantial Shareholders and Other Persons' Long Positions in Shares and Underlying Shares | Shareholder Name/Entity | Capacity | Total Long Position | Approximate Percentage of Issued Share Capital | | :--- | :--- | :--- | :--- | | Quan Hui Holdings Limited | Beneficial owner | 58,254,776 | 19.15% | | Ma De Min (Trustee) | Other | 58,342,276 | 19.18% | | Wong Kwok Keung (Trustee) | Other | 58,342,276 | 19.18% | | Li Ren | Held by controlled corporation/Beneficial owner | 60,392,776 | 19.85% | | China Orient Asset Management Co., Ltd. | Held by controlled corporation | 15,774,465 | 5.18% | | Changzhou Yaoguang Enterprise Management Consulting Partnership (Limited Partnership) | Held by controlled corporation | 26,240,000 | 8.62% | | Lei Chang Juan | Held by controlled corporation | 26,240,000 | 8.62% | | Changzhou Zhongmin Xingkong Enterprise Management Consulting Service Partnership (Limited Partnership) | Held by controlled corporation | 16,060,000 | 5.28% | | Kong Yu Shu | Held by controlled corporation | 16,060,000 | 5.28% | - Due to a bankruptcy order, Mr. Dai Yu Min's property, including shares, has been vested in the trustees Mr. Ma De Min and Mr. Wong Kwok Keung[100] - Quan Hui Holdings Limited has pledged its interest in 15,774,465 shares to Optimus[100] Directors' Rights to Acquire Shares or Debentures For the six months ended June 30, 2024, no directors, chief executives, or their spouses or children under 18 were granted or exercised any rights to acquire shares or debentures of the company - For the six months ended June 30, 2024, no directors or chief executives or their spouses or children under the age of 18 were granted or exercised any rights to acquire benefits through the purchase of shares or debentures of the company[104][106] Directors' Interest in Competing Business For the six months ended June 30, 2024, no directors, substantial shareholders, or their close associates had any interests in businesses competing or potentially competing with the group - For the six months ended June 30, 2024, no directors or substantial shareholders or their close associates had any interests in any business that competes or is likely to compete with the Group's business[108] Share Options The company adopted a share option scheme on September 14, 2011, to incentivize participants, with no changes in the number of outstanding options during the six months ended June 30, 2024 - The Share Option Scheme aims to provide incentives or rewards to participants for their contributions to the Group and to attract and retain excellent employees[108] Share Option Movements (For the six months ended June 30) | Grant Date | Exercise Price (HKD) | Outstanding at Dec 31, 2023 | Granted in 2024 | Exercised in 2024 | Reclassified in 2024 | Lapsed in 2024 | Outstanding at June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | September 16, 2015 | 90.00 | 330,200 | – | – | – | – | 330,200 | | September 9, 2016 | 58.20 | 390,520 | – | – | – | – | 390,520 | - There were no changes in the number of share options during the six months ended June 30, 2024[109][114] - The number of shares and exercise prices of the share options have been adjusted in accordance with the company's two share consolidations (effective May 16, 2019, and September 6, 2023)[121][122] Issue of Equity Securities For the six months ended June 30, 2024, the company did not issue any equity securities - For the six months ended June 30, 2024, the company did not issue any equity securities[123] Corporate Governance Practice The company complied with the GEM Listing Rules' Corporate Governance Code, except for the combined roles of Chairman and CEO, which the Board believes enhances business strategy execution and operational efficiency - The company complied with the Corporate Governance Code set out in Appendix C1 to the GEM Listing Rules, except for the combined roles of Chairman and Chief Executive Officer held by Mr. Wang Chuang[123] - The Board believes this combined arrangement facilitates the execution of the Group's business strategies and enhances operational efficiency, and will review the existing structure from time to time[123] Review of Interim Financial Statements by Audit Committee The Audit Committee, comprising three independent non-executive directors, has reviewed the unaudited condensed consolidated interim financial statements for the six months ended June 30, 2024 - The Audit Committee comprises three independent non-executive directors: Mr. Leung Man Fai (Chairman), Ms. Fok Chun Yuk, and Dr. Liu Ming[124] - The Audit Committee has reviewed the unaudited condensed consolidated interim financial statements for the six months ended June 30, 2024[124] Securities Dealing Code The company adopted the GEM Listing Rules' Securities Dealing Code for Directors, with all directors confirming full compliance during the reporting period - The company has adopted the Securities Dealing Code for Directors as set out in Rules 5.48 to 5.67 of the GEM Listing Rules[124] - All directors have confirmed full compliance with the code for the six months ended June 30, 2024[124] Purchase, Sale or Redemption of Securities For the six months ended June 30, 2024, neither the company nor its subsidiaries purchased, redeemed, or sold any of the company's listed securities - For the six months ended June 30, 2024, neither the company nor any of its subsidiaries purchased, redeemed, or sold any of the company's listed securities[124] Event After the Reporting Period No significant events occurred after the reporting period up to the date of this report - No significant events occurred after the reporting period up to the date of this report[126][127]