信义能源(03868) - 2025 - 中期业绩

Financial Highlights The company achieved significant growth in revenue, profit, and dividends for the six months ended June 30, 2025 Financial Highlights for the Six Months Ended June 30, 2025 | Indicator | 2025 (RMB million) | 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 1,210.2 | 1,124.0 | 7.7% | | Profit attributable to equity holders of the Company | 449.8 | 364.4 | 23.4% | | Earnings per share - basic (RMB cents) | 5.37 | 4.41 | 21.8% | | Interim dividend (RMB million) | 222.1 | 177.8 | 24.9% | | Interim dividend per share (HK cents) | 2.9 | 2.3 | 26.1% | Condensed Consolidated Financial Statements This section presents the condensed consolidated financial statements, including income, comprehensive income, financial position, equity changes, and cash flows Condensed Consolidated Statement of Profit or Loss The Group's revenue for the six months ended June 30, 2025, increased by 7.7% to RMB1,210,234 thousand, with profit attributable to equity holders growing by 23.4% Key Data from Condensed Consolidated Statement of Profit or Loss | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue | 1,210,234 | 1,124,053 | | Cost of sales | (462,813) | (401,737) | | Gross profit | 747,421 | 722,316 | | Operating profit | 731,301 | 706,917 | | Profit before income tax | 585,162 | 527,320 | | Profit for the period | 449,842 | 364,991 | | Profit attributable to equity holders of the Company | 449,842 | 364,448 | | Basic and diluted earnings per share (RMB cents) | 5.37 | 4.41 | Condensed Consolidated Statement of Comprehensive Income The Group's total comprehensive income for the six months ended June 30, 2025, significantly increased to RMB447,622 thousand, primarily due to a substantial reduction in foreign currency translation losses Key Data from Condensed Consolidated Statement of Comprehensive Income | Indicator | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Profit for the period | 449,842 | 364,991 | | Exchange differences on translation of foreign operations | (2,181) | (127,584) | | Share of other comprehensive (loss)/income of associates accounted for using the equity method | (39) | 9 | | Total comprehensive income for the period | 447,622 | 237,416 | | Total comprehensive income attributable to equity holders of the Company | 447,622 | 236,873 | Condensed Consolidated Statement of Financial Position As of June 30, 2025, the Group's total assets were RMB22,103,578 thousand, with total equity at RMB12,744,799 thousand, primarily comprising property, plant, and equipment in non-current assets and trade and other receivables in current assets Key Data from Condensed Consolidated Statement of Financial Position | Indicator | As of June 30, 2025 (RMB thousand) | As of December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | ASSETS | | | | Total non-current assets | 16,575,620 | 16,727,382 | | Total current assets | 5,527,958 | 4,941,119 | | TOTAL ASSETS | 22,103,578 | 21,668,501 | | EQUITY | | | | Total equity | 12,744,799 | 12,504,485 | | LIABILITIES | | | | Total non-current liabilities | 6,049,365 | 5,986,271 | | Total current liabilities | 3,309,414 | 3,177,745 | | TOTAL LIABILITIES | 9,358,779 | 9,164,016 | Condensed Consolidated Statement of Changes in Equity For the six months ended June 30, 2025, total equity attributable to equity holders increased from RMB12,504,485 thousand to RMB12,744,799 thousand, driven by profit for the period and dividend distributions Changes in Equity Attributable to Equity Holders of the Company | Item | As of June 30, 2025 (RMB thousand) | As of June 30, 2024 (RMB thousand) | | :--- | :--- | :--- | | Balance at beginning of period | 12,504,485 | 12,119,808 | | Profit for the period | 449,842 | 364,448 | | Other comprehensive loss | (2,220) | (127,575) | | Employee share option scheme | (1,746) | (546) | | Dividends | (207,398) | (198,721) | | Transfer to safety reserve | — | — | | Balance at end of period | 12,744,799 | 12,158,023 | Condensed Consolidated Statement of Cash Flows For the six months ended June 30, 2025, net cash generated from operating activities significantly increased, net cash used in investing activities substantially decreased, and financing activities shifted from net inflow to net outflow Key Data from Condensed Consolidated Statement of Cash Flows | Cash Flow Category | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Net cash generated from operating activities | 308,995 | 169,559 | | Net cash used in investing activities | (186,776) | (624,126) | | Net cash (used in)/generated from financing activities | (100,958) | 316,909 | | Net increase/(decrease) in cash and cash equivalents | 21,261 | (137,658) | | Cash and cash equivalents at end of period | 374,713 | 441,592 | Notes to the Financial Statements This section provides detailed notes on the financial statements, covering general information, accounting policies, revenue, expenses, and financial position items 1 General Information Xinyi Energy Holdings Limited and its subsidiaries primarily operate and manage solar farms in China, with interim financial information presented in RMB thousand and approved for publication on August 1, 2025 - The Group primarily operates and manages solar farms in the People's Republic of China[14] - The unaudited condensed consolidated interim financial information is presented in RMB thousand and was approved for publication by the Board of Directors on August 1, 2025[14] 2 Basis of Preparation and Changes in Accounting Policies This interim financial information is prepared in accordance with HKAS 34, with consistent accounting policies from the prior year, but with the first-time adoption of newly revised HKFRSs and a retrospective change in presentation currency to RMB 2(a) Adoption of New Standards, Interpretations and Amendments by the Group The Group adopted revised HKFRSs for the first time in this period, including HKAS 21 (Amendment) "Lack of Exchangeability" - The revised HKFRSs, including HKAS 21 (Amendment) "Lack of Exchangeability," were adopted for the first time in this period[16][17] - The adoption of these revised standards and interpretations is not expected to have any significant impact on the Group's results and financial position for the current or prior periods[16] 2(b) Standards Issued But Not Yet Effective for Accounting Periods Beginning on or After January 1, 2025, and Not Early Adopted by the Group Standards issued but not yet effective include HKFRS 9 and 7 (Amendments) "Classification and Measurement of Financial Instruments" and HKFRS 18 "Presentation and Disclosure in Financial Statements" - Standards issued but not yet effective include HKFRS 9 and 7 (Amendments) "Classification and Measurement of Financial Instruments," Annual Improvements to HKFRSs – Volume 1, and HKFRS 18 "Presentation and Disclosure in Financial Statements"[19] - The Group is currently assessing the impact of these amended standards, with preliminary assessments indicating no significant impact on financial performance and position[19] 2(c) Change in Presentation Currency The Company decided to adopt RMB as the presentation currency for its consolidated financial statements, with comparative figures retrospectively restated - The Company decided to adopt RMB as the presentation currency for the Group's consolidated financial statements, with retrospective restatement of comparative figures[20] - The change in presentation currency is due to the majority of the Group's business transactions being settled in RMB and most operations and assets being located in Mainland China, which the Board believes provides a more accurate understanding of financial performance for shareholders and potential investors[20] 3 Revenue, Other Income and Segment Information The Group's revenue primarily derives from electricity sales, tariff adjustments, and solar farm operation and management services, totaling RMB1,210,234 thousand for the six months ended June 30, 2025, with other income of RMB13,508 thousand mainly from government grants Revenue and Other Income Details | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | REVENUE | | | | Electricity sales | 740,552 | 644,274 | | Tariff adjustments | 464,998 | 473,854 | | Solar farm operation and management services | 4,684 | 5,925 | | TOTAL REVENUE | 1,210,234 | 1,124,053 | | OTHER INCOME | | | | Government grants | 11,051 | 3,665 | | Insurance compensation | 723 | 437 | | Others | 1,734 | 4,922 | | TOTAL OTHER INCOME | 13,508 | 9,024 | - The Group primarily operates and manages solar farms in China, with no separate operating segment financial information[23] 4 Other Net Gains For the six months ended June 30, 2025, the Group's other net gains significantly increased to RMB7,695 thousand, primarily driven by higher net foreign exchange gains Other Net Gains Details | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Net foreign exchange gains | 7,596 | 250 | | Loss on disposal of property, plant and equipment | (86) | (70) | | Net fair value gains on financial assets at fair value through profit or loss | 185 | 3,547 | | TOTAL | 7,695 | 3,727 | 5 Operating Profit The Group's operating profit for the six months ended June 30, 2025, was RMB731,301 thousand, mainly impacted by increased depreciation expenses for property, plant, and equipment Components of Operating Profit | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Depreciation expenses for property, plant and equipment | 361,755 | 314,713 | | Depreciation expenses for right-of-use assets | 26,060 | 16,684 | | Employee benefit expenses | 30,329 | 30,353 | | Electricity expenses | 13,108 | 15,984 | | Repair and maintenance | 21,445 | 19,058 | | Insurance expenses | 3,361 | 2,520 | 6 Finance Income and Finance Costs For the six months ended June 30, 2025, the Group's finance income was RMB1,826 thousand, and finance costs were RMB147,544 thousand, with finance costs decreasing primarily due to lower interest expenses on bank borrowings Finance Income and Finance Costs Details | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | FINANCE INCOME | | | | Interest income from bank deposits | 1,511 | 2,583 | | Interest income from loans to associates accounted for using the equity method | 315 | — | | TOTAL FINANCE INCOME | 1,826 | 2,583 | | FINANCE COSTS | | | | Interest on lease liabilities | 26,298 | 22,313 | | Interest expenses on bank borrowings | 121,246 | 159,859 | | TOTAL FINANCE COSTS | 147,544 | 182,172 | 7 Income Tax Expense For the six months ended June 30, 2025, the Group's income tax expense decreased to RMB135,320 thousand, mainly due to reduced China withholding tax, partially offset by increased taxable profit and more solar farm projects subject to statutory tax rates Income Tax Expense Details | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | China corporate income tax | 142,372 | 149,583 | | Overseas tax | 17 | — | | China withholding tax | 2,500 | 23,000 | | Deferred income tax | (9,569) | (10,254) | | TOTAL INCOME TAX EXPENSE | 135,320 | 162,329 | - Chinese subsidiaries enjoy various corporate income tax preferential rates, including a 15% rate for high-tech enterprises, a 15% rate for encouraged enterprises in central and western regions (9% in 2024), and preferential rates for small low-profit enterprises[29][33] - Dividends paid by Chinese subsidiaries are subject to a 5% withholding tax[30] 8 Earnings Per Share For the six months ended June 30, 2025, basic earnings per share attributable to equity holders increased to RMB5.37 cents from RMB4.41 cents in the prior period, with diluted earnings per share being the same as basic earnings per share due to no potential dilutive shares Basic Earnings Per Share Calculation | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Profit attributable to equity holders of the Company (RMB thousand) | 449,842 | 364,448 | | Weighted average number of ordinary shares in issue (thousand shares) | 8,376,654 | 8,256,589 | | Basic earnings per share (RMB cents) | 5.37 | 4.41 | - For the six months ended June 30, 2025 and 2024, diluted earnings per share were equal to basic earnings per share as there were no potential dilutive shares[34] 9 Dividends The Board resolved to declare an interim dividend of 2.9 HK cents per share for the six months ended June 30, 2025, an increase from 2.3 HK cents per share in the prior period Dividend Distribution Status | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Final dividend for 2024 of 2.7 HK cents per share (2023: 2.6 HK cents) | 207,398 | 198,721 | | Proposed interim dividend of 2.9 HK cents per share (2024: 2.3 HK cents) | 222,080 | 177,750 | - The proposed interim dividend totaling HK$242,923,000 (equivalent to RMB222,080,000) has not been recognized as a liability in this interim financial information[35] 10 Property, Plant and Equipment As of June 30, 2025, the Group's net book value of property, plant and equipment was RMB15,216,079 thousand, a slight decrease from the beginning of the period, mainly due to depreciation expenses, but with new additions Changes in Property, Plant and Equipment | Item | Solar Farms (RMB thousand) | Buildings (RMB thousand) | Motor vehicles, furniture and fixtures, equipment and others (RMB thousand) | Total (RMB thousand) | | :--- | :--- | :--- | :--- | :--- | | Net book value at beginning of period | 15,222,718 | 144,598 | 27,632 | 15,394,948 | | Additions | 182,348 | — | 6,341 | 188,689 | | Disposals | (5,780) | — | (23) | (5,803) | | Depreciation expenses | (356,069) | (3,463) | (2,223) | (361,755) | | Net book value at end of period | 15,043,217 | 141,135 | 31,727 | 15,216,079 | 11 Trade and Other Receivables and Prepayments As of June 30, 2025, the current portion of the Group's trade and other receivables and prepayments increased to RMB5,140,461 thousand, primarily comprising receivables from tariff adjustments Trade and Other Receivables and Prepayments Details | Item | As of June 30, 2025 (RMB thousand) | As of December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Net trade receivables | 4,738,862 | 4,204,565 | | Deposits and other receivables | 38,054 | 43,177 | | Other tax receivables | 270,471 | 304,456 | | Prepayments for land use rights and property, plant and equipment | 33,782 | 27,735 | | Other prepayments | 93,074 | 28,112 | | CURRENT PORTION | 5,140,461 | 4,580,310 | Ageing Analysis of Trade Receivables | Ageing | As of June 30, 2025 (RMB thousand) | As of December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | 0 to 90 days | 441,824 | 378,705 | | 91 to 180 days | 237,053 | 325,528 | | 181 to 365 days | 567,084 | 549,483 | | Over 365 days | 3,540,768 | 2,993,319 | | TOTAL | 4,786,729 | 4,247,035 | - Trade receivables include receivables from electricity sales and tariff adjustments, with tariff adjustment receivables (government subsidies) to be collected from state-owned grid companies in accordance with government policies[37][38] 12 Share Capital As of June 30, 2025, the Company's authorized share capital was 800,000,000,000 ordinary shares of HK$0.01 each, with 8,376,653,757 issued and fully paid shares totaling RMB72,497 thousand Share Capital Structure | Category | Number of Ordinary Shares | Par Value Per Share (HK$) | Total (HK thousand) | | :--- | :--- | :--- | :--- | | Authorized share capital | 800,000,000,000 | 0.01 | 8,000,000 | | Issued and fully paid share capital | 8,376,653,757 | 0.01 | 72,497 (RMB thousand) | 13 Accruals and Other Payables As of June 30, 2025, the current portion of the Group's accruals and other payables was RMB452,648 thousand, primarily comprising payables for property, plant and equipment, and accrued professional fees, bank loan interest, and staff costs Accruals and Other Payables Details | Item | As of June 30, 2025 (RMB thousand) | As of December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Payables for property, plant and equipment | 407,766 | 418,509 | | Others | 61,863 | 47,373 | | CURRENT PORTION | 452,648 | 450,504 | - The carrying amounts of accruals and other payables are primarily denominated in RMB and approximate their fair values[41] 14 Bank Borrowings As of June 30, 2025, the Group's total bank borrowings amounted to RMB7,256,873 thousand, with a current portion of RMB2,433,489 thousand, and most borrowings are interest-bearing at floating rates and have been converted to RMB denomination Bank Borrowings Repayment Schedule Analysis | Term | As of June 30, 2025 (RMB thousand) | As of December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Within 1 year | 2,433,489 | 2,541,250 | | 1 to 2 years | 849,596 | 840,041 | | 2 to 5 years | 1,424,753 | 1,696,935 | | Over 5 years | 2,549,035 | 2,252,248 | | TOTAL | 7,256,873 | 7,330,474 | Bank Borrowings Currency Composition | Currency | As of June 30, 2025 (RMB thousand) | As of December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | HKD | — | 1,521,340 | | RMB | 7,256,873 | 5,809,134 | | TOTAL | 7,256,873 | 7,330,474 | - As of June 30, 2025, the average effective interest rate for bank borrowings was 2.88%, a decrease from 3.50% as of December 31, 2024[44] - The Company and its subsidiaries provide corporate guarantees for bank borrowings[44] 15 Related Party Transactions The Group engaged in various ordinary course of business transactions with related parties, including subsidiary acquisitions, operation and management services, green electricity certificate sales, office and land leases, and related receivables, payables, and loans 15(a) Summary of Related Party Transactions The Group's related party transactions include acquiring a subsidiary from a fellow subsidiary, providing solar farm operation and management services, selling green electricity certificates, and interest income from loans to associates Related Party Transactions Details | Transaction Type | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Acquisition of a subsidiary from a fellow subsidiary | 14,839 | 140,534 | | Receivables for solar farm operation and management services from Xinyi Solar subsidiaries | 4,613 | 5,925 | | Sale of green electricity certificates to Xinyi Solar | 227 | — | | Interest income from loans to associates accounted for using the equity method | 315 | — | - These transactions constitute continuing connected transactions as defined in Chapter 14A of the Listing Rules, conducted at prices and terms agreed upon by the parties[46] 15(b) Balances with Related Parties Balances with related parties include amounts due from fellow subsidiaries, receivables from associates accounted for using the equity method, loans to associates, and amounts due to fellow subsidiaries Related Party Balances Details | Item | As of June 30, 2025 (RMB thousand) | As of December 31, 2024 (RMB thousand) | | :--- | :--- | :--- | | Amounts due from fellow subsidiaries | 1,657 | 1,336 | | Receivables from associates accounted for using the equity method | — | 2,235 | | Loans to associates accounted for using the equity method | 7,968 | — | | Amounts due to fellow subsidiaries | (85,743) | (85,912) | - Amounts due from and to related parties and loans to associates accounted for using the equity method are unsecured, interest-free, repayable on demand, and denominated in HKD, RMB, and Malaysian Ringgit[48] - Loans to associates accounted for using the equity method are denominated in Ringgit and bear interest at an effective rate of 7.9%[49] 15(c) Leases The Group leases office and land space from related parties, with rental terms agreed upon by both parties Interest Expenses on Related Party Lease Liabilities | Related Party | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Smart Harvest Investment Limited | 3 | 3 | | Xinyi Energy (Wuhu) Co., Ltd. | 30 | 52 | | Xinde Park (Wuhu) Co., Ltd. | 19 | — | | TOTAL | 52 | 55 | - The Group leases office space and land space from related parties, with rental terms agreed upon by both parties[50] 15(d) Key Management Personnel Remuneration Key management personnel remuneration includes salaries, allowances, benefits in kind, retirement benefit scheme contributions, and share options granted Key Management Personnel Remuneration Details | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Salaries, allowances and benefits in kind | 2,350 | 6,018 | | Contributions to retirement benefit schemes | 33 | 33 | | Share options granted | 17 | — | | TOTAL | 2,400 | 6,051 | 16 Contingent Liabilities As of June 30, 2025, and December 31, 2024, the Group had no significant contingent liabilities - The Group had no significant contingent liabilities at the end of the reporting period[53] Management Discussion and Analysis This section provides an overview of the Group's operating results, financial position, liquidity, business outlook, and strategies for the period Overview China's carbon peak and neutrality goals, coupled with supportive policies, have driven rapid growth in the photovoltaic industry, with technology maturity and cost reductions solidifying solar power's clean energy status, despite grid curtailment losses and lower market-based electricity prices impacting revenue - China's "carbon peak before 2030 and carbon neutrality before 2060" targets and various supportive policies are driving rapid development in the photovoltaic industry[54] - Policies such as the "Administrative Measures for the Development and Construction of Distributed Photovoltaic Power Generation" and the "Notice on Deepening the Market-Oriented Reform of New Energy On-grid Tariffs to Promote High-Quality Development of New Energy" led to two rounds of "rush installations" in the first half of 2025, with new photovoltaic installed capacity exceeding 200 GW[54][55] - During the period, the Group incurred some curtailment losses due to grid absorption limitations, and some market-based electricity transaction prices were slightly lower than on-grid tariffs, leading to a decrease in electricity sales revenue[56] Key Financial Performance for H1 2025 | Indicator | H1 2025 (RMB million) | H1 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 1,210.2 | 1,124.0 | 7.7% | | Profit attributable to equity holders of the Company | 449.8 | 364.4 | 23.4% | | Basic earnings per share (RMB cents) | 5.37 | 4.41 | - | Operating Results Analysis The Group's revenue grew by 7.7% in the first half of 2025, primarily due to expanded solar farm project capacity, though partially offset by curtailment losses and market-based electricity transactions, while gross profit and net profit increased, and finance costs and income tax expenses decreased Revenue Contribution for H1 2025 The Group's total electricity generation increased by 22.7% in H1 2025, driven by new acquisitions and full operation of the 2024 portfolio, despite some offset from grid curtailment and increased market-based transactions - In the first half of 2025, the Group's total electricity generation from solar farm projects increased by 22.7% compared to the first half of 2024, primarily due to the successful acquisition of a large solar farm project and the full operation of the 2024 portfolio[57] - The 2024 portfolio and 2025 portfolio together contributed RMB137.1 million in revenue to the Group[57] - The increase in revenue was partially offset by curtailment losses due to grid absorption limitations and an increase in the frequency and volume of market-based electricity transactions[57] Expansion of Solar Farm Project Capacity in H1 2025 In the first half of 2025, the Group acquired a 30 MW grid-parity solar farm project in China, bringing its total approved generation capacity to 4,540.5 MW, with a focus on grid-parity projects to enhance operating cash flow - In the first half of 2025, the Group acquired a 30 MW grid-parity solar farm project in China from Xinyi Solar Group[58] - As of June 30, 2025, the Group operated and held solar farm projects with a total approved generation capacity of 4,540.5 MW, comprising 1,734 MW under the on-grid tariff policy and 2,806.5 MW under the grid-parity policy[58] - The Group focuses on investing in solar farm projects under the grid-parity policy, with electricity sales contributing 61.2% of revenue, an increase of 14.9%, driving continuous improvement in operating cash flow[58] Revenue The Group's revenue primarily stems from solar power generation and the provision of solar farm operation and management services - The Group's revenue primarily comes from solar power generation and the provision of solar farm operation and management services[59] Revenue Comparative Analysis | Item | H1 2025 (RMB million) | Percentage | H1 2024 (RMB million) | Percentage | Change (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Electricity sales | 740.5 | 61.2 | 644.2 | 57.3 | 96.3 | 14.9 | | Tariff adjustments | 465.0 | 38.4 | 473.9 | 42.2 | (8.9) | (1.9) | | Operation and management services | 4.7 | 0.4 | 5.9 | 0.5 | (1.2) | (20.3) | | TOTAL | 1,210.2 | 100.0 | 1,124.0 | 100.0 | 86.2 | 7.7 | - As of the first half of 2025, the Group operated solar farm projects with a total approved capacity of 4,540.5 MW, including initial projects, the 2019-2024 portfolios, and the newly added Sanshan Gaoan solar farm in the first half of 2025[63][64] Cost of Sales Cost of sales increased by RMB61.1 million to RMB462.8 million, mainly due to higher depreciation expenses for property, plant and equipment, right-of-use assets, and increased repair and maintenance expenses for the 2024 portfolio - Cost of sales increased by RMB61.1 million to RMB462.8 million, primarily due to increased depreciation expenses for property, plant and equipment and right-of-use assets, as well as higher repair and maintenance expenses for the 2024 portfolio[66] Gross Profit Gross profit increased by RMB25.1 million or 3.5% to RMB747.4 million, while the gross profit margin decreased from 64.3% to 61.8%, mainly because revenue growth outpaced cost of sales growth - Gross profit increased by RMB25.1 million or 3.5% to RMB747.4 million, with the gross profit margin decreasing from 64.3% to 61.8%, primarily because revenue growth exceeded cost of sales growth[67] Other Income Other income increased by RMB4.5 million to RMB13.5 million, mainly due to higher government grants and insurance compensation in China - Other income increased by RMB4.5 million to RMB13.5 million, primarily due to increased government grants and insurance compensation in China[68] Other Net Gains Other net gains significantly increased by RMB4.0 million to RMB7.7 million, primarily driven by higher foreign exchange gains - Other net gains significantly increased by RMB4.0 million to RMB7.7 million, primarily due to increased foreign exchange gains[69] Administrative Expenses Administrative expenses increased by RMB9.3 million to RMB31.9 million, mainly due to higher miscellaneous expenses and insurance expenses - Administrative expenses increased by RMB9.3 million to RMB31.9 million, primarily due to increased miscellaneous expenses and insurance expenses[70] Finance Costs Total finance costs decreased to RMB147.5 million, mainly due to lower effective interest rates on bank borrowings and a slight reduction in interest-bearing bank borrowing balances - Total finance costs decreased to RMB147.5 million, primarily due to a decrease in the effective interest rate on bank borrowings and a slight reduction in interest-bearing bank borrowing balances[71] - Interest on lease liabilities slightly increased to RMB26.3 million due to the completion of the acquisition of the 2024 portfolio[71] Income Tax Expense Income tax expense decreased to RMB135.3 million, mainly due to reduced China withholding tax, partially offset by increased taxable profit and more solar farm projects becoming subject to statutory tax rates - Income tax expense decreased to RMB135.3 million, primarily due to a reduction in China withholding tax, partially offset by an increase in taxable profit and more solar farm projects becoming subject to statutory tax rates[72] EBITDA and Net Profit EBITDA increased by 7.7% to RMB1,120.5 million, and net profit attributable to equity holders increased by 23.4% to RMB449.8 million, with the net profit margin improving to 37.2% EBITDA and Net Profit Performance | Indicator | H1 2025 (RMB million) | H1 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | EBITDA | 1,120.5 | 1,040.9 | 7.7% | | Net profit attributable to equity holders of the Company | 449.8 | 364.4 | 23.4% | | Net profit margin | 37.2% | 32.4% | 4.8 percentage points | - The increase in net profit margin was primarily due to higher revenue, lower finance costs, and reduced income tax expense, partially offset by increased depreciation expenses[73] Financial Position and Liquidity As of June 30, 2025, the Group maintained a robust financial position with growth in total assets and net assets, improved current ratio and net gearing ratio, significantly increased operating cash flow, reduced investing cash outflow, and increased financing cash outflow Key Financial Position Indicators | Indicator | As of June 30, 2025 | As of December 31, 2024 | | :--- | :--- | :--- | | Total assets | RMB22,103.6 million | RMB21,668.5 million | | Net assets | RMB12,744.8 million | RMB12,504.5 million | | Current ratio | 1.7 | 1.6 | | Net gearing ratio | 54.0% | 55.8% | Cash Flow Performance | Cash Flow Category | H1 2025 (RMB million) | H1 2024 (RMB million) | | :--- | :--- | :--- | | Net cash generated from operating activities | 309.0 | 169.6 | | Net cash used in investing activities | (186.8) | (624.1) | | Net cash (used in)/generated from financing activities | (101.0) | 316.9 | | Cash and cash equivalents at end of period | 374.7 | 441.6 | - Net cash generated from operating activities increased primarily due to higher profit before income tax and lower interest and income tax paid, partially offset by an increase in trade and other receivables[75] - Net cash used in financing activities was mainly due to repayment of bank borrowings of RMB994.6 million, partially offset by new bank borrowings of RMB921.0 million[75] Business Outlook and Strategies Facing new energy market reforms and electricity price volatility, the Group is adjusting its operating strategies, including signing medium-to-long-term power purchase agreements, establishing a market-oriented trading team, and developing AI prediction models, while also planning to set up an infrastructure securities investment fund to optimize financing structure and actively expand into overseas markets like Malaysia, Japan, and other Asia-Pacific regions Policy Impact and Responses China's new energy market reforms are shifting electricity prices from policy-driven to market-driven, prompting the Group to monitor policy developments and assess their impact on operations, project returns, and investment strategies - China's new energy market-oriented reform is shifting electricity prices from policy-driven to market-driven, and the Group is closely monitoring policy developments and assessing their impact on business operations, project returns, and investment strategies[76] - Due to unclear policy details, the Group's annual acquisition plan from Xinyi Solar Group for 2025 has been postponed[77] - To counter declining market-based transaction electricity prices, the Group plans to sign medium-to-long-term power purchase agreements to stabilize electricity sales prices, establish a market-oriented trading team, and utilize AI prediction models to enhance decision-making efficiency[78] - The Group is implementing a plan to establish an infrastructure securities investment fund for selected solar farm assets, aiming for listing on a Chinese stock exchange to partially realize its portfolio and enhance financial flexibility[78] Financing Strategy To address rising financing costs, the Group increased domestic long-term bank loans to refinance existing offshore short-term loans, effectively reducing overall financing costs and converting all non-RMB bank loans to RMB to mitigate exchange rate volatility - To counter rising financing costs, the Group increased domestic long-term bank loans to refinance original offshore short-term loans, effectively reducing overall financing costs[79] - In the first half of 2025, the Group completed the currency conversion of all non-RMB denominated bank loans to RMB denominated loans to mitigate the impact of exchange rate fluctuations[79] - As of June 30, 2025, short-term borrowings accounted for 33.5% of bank loans, lower than 34.7% as of December 31, 2024, reflecting improved capital structure stability[79] Overseas Business Expansion The Group's joint venture secured a 100 MW large-scale solar farm project in Malaysia in mid-2024, with construction expected to commence in the second half of 2025, as the Group continues to seek new energy opportunities in Malaysia, Japan, and other Asia-Pacific regions - The Group's joint venture won a bid for a 100 MW large-scale solar farm project in Malaysia in mid-2024, with construction expected to commence in the second half of 2025[80] - The Group will continue to identify potential new energy opportunities in Malaysia and other overseas markets, including Japan and other Asia-Pacific regions, to expand its business footprint and enhance asset returns[80] Capital Expenditure and Commitments In the first half of 2025, the Group incurred capital expenditure of RMB182.7 million, primarily for acquiring, improving existing, and adding new solar farm projects, as well as settling outstanding capital expenditures, with no capital commitments as of June 30, 2025 - In the first half of 2025, the Group incurred capital expenditure of RMB182.7 million[81] - Capital expenditure was primarily used for acquiring and improving existing and new solar farm projects, and settling outstanding capital expenditures for completed construction projects[81] - As of June 30, 2025, the Group had no capital commitments[81] Pledged Assets As of June 30, 2025, the Group had not pledged any assets as collateral for bank borrowings - As of June 30, 2025, the Group had not pledged any assets as collateral for bank borrowings[82] Contingent Liabilities As of June 30, 2025, the Group had no significant contingent liabilities - As of June 30, 2025, the Group had no significant contingent liabilities[83] Significant Acquisitions and Disposals of Subsidiaries In the first half of 2025, the Group completed the acquisition of Wuhu Xintu New Energy Co., Ltd., a 30 MW solar farm project in China, with no other significant subsidiary acquisitions or disposals during the period - In the first half of 2025, the Group completed the acquisition of Wuhu Xintu New Energy Co., Ltd., a solar farm project in China with an approved capacity of 30 MW[84] - Other than the aforementioned disclosure, there were no other significant acquisitions or disposals of subsidiaries in the first half of 2025[85] Treasury Policy and Exchange Rate Fluctuation Risk The Group's primary business transactions and assets are RMB-denominated, resulting in no significant foreign exchange risk, and all HKD-denominated bank borrowings were converted to RMB to further mitigate risk, with no financial instruments used for hedging during the period - The Group's consolidated financial statements are presented in RMB, which is also the functional currency of its major subsidiaries, while the Company's functional currency is HKD[86] - As most business transactions are settled in RMB and assets are located in China, the Group does not face significant foreign exchange risk[86] - To mitigate foreign exchange risk, the Group completed the conversion of all HKD-denominated bank borrowings to RMB-denominated bank borrowings in the first half of 2025[86] Employees and Remuneration Policy As of June 30, 2025, the Group had 428 full-time employees in Hong Kong and China, with total staff costs of RMB30.3 million, and remuneration is based on qualifications, job nature, performance, and market levels, including MPF schemes and statutory social security contributions - As of June 30, 2025, the Group had 428 full-time employees in Hong Kong and China[87] - Total staff costs (including directors' emoluments) for the first half of 2025 amounted to RMB30.3 million[87] - Employee remuneration is determined based on qualifications, job nature, performance, and work experience, with reference to current market remuneration levels, and includes contributions to MPF schemes and statutory social security[87] Other Information This section covers additional information including capital structure, share option scheme, post-balance sheet events, interim dividend, securities transactions, corporate governance, and board details Capital Structure There were no significant changes to the Company's capital structure in the first half of 2025, with the company's share capital consisting of ordinary shares - There were no significant changes to the Company's capital structure in the first half of 2025[88] - The Group's share capital consists of ordinary shares[88] Share Option Scheme Under the share option scheme adopted in November 2018, the Company granted 3,500,000 share options to selected employees in March 2025, valid until March 31, 2029, with phased vesting conditions - In March 2025, 3,500,000 share options were granted to selected employees[89] - The share options are valid from March 31, 2025, to March 31, 2029[89] - One-third of the share options will vest on December 31, 2025, 2026, and 2027, respectively, provided the grantees meet the vesting conditions outlined in the grant letter[89] Post Balance Sheet Events As of the date of this announcement, no significant events affecting the Group have occurred since June 30, 2025 - No significant events affecting the Group have occurred after June 30, 2025, and up to the date of this announcement[90] Interim Dividend and Closure of Register of Members The Board resolved to declare an interim dividend of 2.9 HK cents per share for the first half of 2025, with the register of members to be closed from August 18 to August 20, 2025, and shareholders having the option to receive dividends in cash or scrip - The Board resolved to declare an interim dividend of 2.9 HK cents per share for the first half of 2025 (first half of 2024: 2.3 HK cents)[91] - The interim dividend is expected to be paid on or around October 10, 2025[91] - The Company's register of members will be closed from August 18 to August 20, 2025 (both dates inclusive), with the record date for determining shareholders entitled to the interim dividend being August 20, 2025[91] - Shareholders will be given an option to elect to receive the interim dividend in cash or in new fully paid shares of the Company in lieu of cash, in whole or in part[91] Purchase, Sale or Redemption of the Company’s Listed Securities In the first half of 2025, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities - In the first half of 2025, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[93] Corporate Governance The Directors confirm that the Company complied with the applicable code provisions of the Corporate Governance Code set out in Appendix C1 Part 2 of the HKEX Listing Rules during the first half of 2025 - The Directors confirm that the Company complied with the applicable code provisions of the Corporate Governance Code set out in Appendix C1 Part 2 of the HKEX Listing Rules during the first half of 2025[94] Standard Code for Securities Transactions The Company adopted the Standard Code for Securities Transactions by Directors of Listed Issuers as its own code of conduct, and all Directors confirmed compliance during the first half of 2025 - The Company adopted the Standard Code for Securities Transactions by Directors of Listed Issuers as its own code of conduct for directors' securities transactions[95] - All Directors confirmed their compliance with the required standards of dealing set out in the Standard Code during the first half of 2025[95] Review of Interim Results The Company's unaudited interim results for the first half of 2025 were not reviewed by external auditors but were reviewed by the Audit Committee - The Company's unaudited interim results for the first half of 2025 were not reviewed by external auditors[96] - The interim results were reviewed by the Company's Audit Committee, which comprises three independent non-executive directors[96] Publication of Interim Report The Company's interim report for the first half of 2025 will be published on the HKEX and the Company's website in due course - The Company's interim report for the first half of 2025 will be published on the HKEX and the Company's website in due course[97][100] Board Information As of the date of this announcement, the Board of Directors comprises four executive directors and three independent non-executive directors, with Mr. Li Sing Pui as Chairman - As of the date of this announcement, the Board of Directors comprises four executive directors (Mr. Li Sing Pui, Tan Sri Dato' David Chua, Mr. Dong Kuang Ya, Mr. Li Youqing) and three independent non-executive directors (Mr. Leung Ting Yuk, Mr. Ip Kwok Him, Ms. Lyu Fang)[99] - The Chairman of the Board is Mr. Li Sing Pui[98][99]