天安卓健(00383) - 2025 - 中期业绩

Company Information and Report Overview This section provides essential company details and an overview of the unaudited interim results for the six months ended June 30, 2025 Company Basic Information This chapter outlines the company's name, stock code, place of incorporation, and the reporting period for its unaudited interim results - Company Name: MEDICARE, Stock Code: 383[2] - Place of Incorporation: Bermuda[2] - Reporting Period: Unaudited interim results for the six months ended June 30, 2025[3] Report Statement and Title This chapter details the disclaimer from Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited, along with the official title of the report - Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness, and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement[1] - The report title is "UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2025 AND RE-DESIGNATION OF NOMINATION COMMITTEE ROLE"[3] Condensed Consolidated Financial Statements This section presents the condensed consolidated financial performance and position of the Group for the reporting period Condensed Consolidated Statement of Profit or Loss For the six months ended June 30, 2025, the Group's total revenue decreased by 4.67% to HK$783,132 thousand, and profit for the period significantly declined by 49.31% to HK$14,739 thousand, primarily due to reduced gross profit and lower income tax expense Condensed Consolidated Statement of Profit or Loss Key Data (Six Months Ended June 30) | Metric | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Total revenue | 783,132 | 821,529 | -4.67% | | Cost of goods and services | (624,489) | (638,528) | -2.20% | | Gross profit | 158,643 | 183,001 | -13.20% | | Operating profit | 35,329 | 61,792 | -42.82% | | Profit before tax | 23,614 | 46,085 | -48.77% | | Income tax expense | (8,875) | (17,004) | -47.81% | | Profit for the period | 14,739 | 29,081 | -49.31% | | Profit attributable to owners of the Company | 11,979 | 21,659 | -44.69% | | Basic earnings per share | HK cents 1.11 | HK cents 1.99 | -44.19% | Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended June 30, 2025, total comprehensive income for the period was HK$26,254 thousand, a 9.72% decrease from HK$29,081 thousand in the prior year, mainly due to exchange differences arising on translation of foreign operations in 2025 which were absent in 2024 Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income Key Data (Six Months Ended June 30) | Metric | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Profit for the period | 14,739 | 29,081 | -49.31% | | Exchange differences arising on translation of foreign operations | 11,515 | – | N/A | | Total comprehensive income for the period | 26,254 | 29,081 | -9.72% | | Total comprehensive income attributable to owners of the Company | 22,662 | 21,659 | +4.63% | | Total comprehensive income attributable to non-controlling interests | 3,592 | 7,422 | -51.60% | Condensed Consolidated Statement of Financial Position As of June 30, 2025, the Group's total assets were HK$3,439,335 thousand, a slight decrease from December 31, 2024, with non-current assets slightly increasing and net current assets improving from HK$193,511 thousand to HK$221,812 thousand Condensed Consolidated Statement of Financial Position Key Data | Metric | 2025 June 30 (HK$ Thousand) | 2024 December 31 (HK$ Thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Non-current assets | 2,196,056 | 2,179,670 | +0.75% | | Current assets | 1,243,279 | 1,359,207 | -8.40% | | Total assets | 3,439,335 | 3,538,877 | -2.81% | | Current liabilities | 1,021,467 | 1,165,696 | -12.40% | | Non-current liabilities | 519,990 | 478,352 | +8.70% | | Total liabilities | 1,541,457 | 1,644,048 | -6.24% | | Net current assets | 221,812 | 193,511 | +14.63% | | Net assets | 1,897,878 | 1,894,829 | +0.16% | | Total equity | 1,897,878 | 1,894,829 | +0.16% | Notes to the Condensed Consolidated Financial Statements This section provides detailed notes on the preparation basis, accounting policies, revenue breakdown, segment information, and other financial items of the Group Basis of Preparation and Accounting Policies The Group's condensed consolidated financial statements are prepared in accordance with HKAS 34 "Interim Financial Reporting" and applicable disclosure requirements of the Listing Rules, maintaining consistency with the accounting policies and methods used in the 2024 annual financial statements - Preparation basis: Hong Kong Accounting Standard 34 "Interim Financial Reporting" and the Listing Rules of the Stock Exchange[9] - Accounting policy consistency: Consistent with those used in the annual financial statements for the year ended December 31, 2024[9] Adoption of New and Revised Hong Kong Financial Reporting Standards The Group has adopted amendments to Hong Kong Financial Reporting Standards, including HKAS 21 (Amendments) – Lack of Exchangeability, with no significant impact on the financial position or performance for the current and prior periods - Adopted HKAS 21 (Amendments) – Lack of Exchangeability[10] - The adoption of new standards has no material impact on the Group's financial position and performance[10] Revenue Breakdown For the six months ended June 30, 2025, the Group's total revenue was HK$783,132 thousand, primarily from contracts with customers (HK$779,792 thousand), with hospital fees and charges being the largest component but showing a year-on-year decrease, while revenue from elderly care related services and nutritional product sales increased Revenue Source Breakdown (Six Months Ended June 30) | Revenue Source | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Hospital fees and charges | 756,739 | 800,390 | -5.45% | | Building management fees | 2,019 | 261 | +673.56% | | Provision of elderly care related services and sales of nutritional products | 21,034 | 17,528 | +19.99% | | Total revenue from contracts with customers | 779,792 | 818,179 | -4.70% | | Rental income | 3,340 | 3,350 | -0.30% | | Total revenue | 783,132 | 821,529 | -4.67% | Segment Information The Group identifies six operating and reportable segments under HKFRS 8: healthcare, elderly care, property development, property investment, financial services, and securities trading and investment, which are regularly reviewed by executive directors for resource allocation and performance assessment - The primary operating decision maker is the Company's executive directors, responsible for resource allocation and performance assessment[13] - Six operating and reportable segments identified: healthcare, elderly care, property development, property investment, financial services, and securities trading and investment[14][15][16][17] Identification of Operating Segments The Group's operating segments include hospitals in China (healthcare), property development and management for elderly care and retirement communities (elderly care), property development and sales, property leasing (property investment), provision of loan financial services (financial services), and securities trading and investment - Healthcare segment: Operates hospitals in China[14] - Elderly care segment: Engages in property development and management for elderly care and retirement communities in China, including nursing homes and serviced apartments[14] - Property development segment: Develops and sells properties and land located in China[14] - Property investment segment: Leases residential and office properties[15] - Financial services segment: Provides loan financial services[16] - Securities trading and investment segment: Trades securities in Hong Kong and overseas markets[17] Segment Revenue and Results Analysis The healthcare segment remains the primary revenue source but saw declines in both revenue and profit, while elderly care, property development, and property investment segments recorded losses, and the securities trading and investment segment turned from loss to gain; net exchange gains in unallocated items positively impacted overall profit before tax Segment Revenue and Profit/(Loss) (Six Months Ended June 30) | Segment | 2025 Revenue (HK$ Thousand) | 2024 Revenue (HK$ Thousand) | 2025 Segment Profit/(Loss) (HK$ Thousand) | 2024 Segment Profit/(Loss) (HK$ Thousand) | | :--- | :--- | :--- | :--- | :--- | | Healthcare | 756,739 | 800,390 | 57,559 | 82,250 | | Elderly Care | 24,254 | 18,942 | (32,066) | (25,735) | | Property Development | – | – | (499) | (4,210) | | Property Investment | 2,139 | 2,197 | (12,212) | (6,096) | | Financial Services | – | – | (2) | (18) | | Securities Trading and Investment | – | – | 53 | (363) | | Consolidated Total Revenue | 783,132 | 821,529 | N/A | N/A | | Consolidated Profit Before Tax | N/A | N/A | 23,614 | 46,085 | - Net exchange gains of HK$8,907 thousand were recorded in the first half of 2025, compared to net exchange losses of HK$2,933 thousand in the same period of 2024[18] Segment Assets and Liabilities As of June 30, 2025, the Group's consolidated assets totaled HK$3,439,335 thousand and consolidated liabilities were HK$1,541,457 thousand, with the healthcare segment holding the largest share of both segment assets and liabilities Segment Assets and Liabilities (As at June 30) | Segment | 2025 Segment Assets (HK$ Thousand) | 2024 Segment Assets (HK$ Thousand) | 2025 Segment Liabilities (HK$ Thousand) | 2024 Segment Liabilities (HK$ Thousand) | | :--- | :--- | :--- | :--- | :--- | | Healthcare | 1,867,989 | 1,906,411 | 931,050 | 1,032,871 | | Elderly Care | 633,400 | 667,677 | 558,828 | 553,099 | | Property Development | 50,868 | 52,184 | 42,437 | 46,612 | | Property Investment | 186,909 | 200,499 | 1,853 | 1,569 | | Financial Services | 129 | 621 | 1,115 | 1,515 | | Securities Trading and Investment | 6,461 | 5,223 | – | – | | Consolidated Assets | 3,439,335 | 3,538,877 | N/A | N/A | | Consolidated Liabilities | N/A | N/A | 1,541,457 | 1,644,048 | Other Gains and Losses and Other Income For the six months ended June 30, 2025, the Group recorded net other gains and losses and other income of a loss of HK$11,779 thousand, an increase from the HK$8,743 thousand loss in the prior year, mainly due to increased fair value losses on investment properties, partially offset by net exchange gains and interest income from bank deposits Other Gains and Losses and Other Income Breakdown (Six Months Ended June 30) | Item | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Fair value gains/(losses) on investments held for trading | 77 | (326) | | Loss on disposal and write-off of property, plant and equipment | (454) | – | | Fair value losses on investment properties | (25,744) | (11,797) | | Net exchange gains/(losses) | 8,907 | (2,933) | | Interest income from bank deposits | 12,914 | 16,739 | | Total | (11,779) | (8,743) | - Government grants primarily refer to subsidies for operating costs of hospitals in China, without specific and unfulfilled conditions[21] Finance Costs For the six months ended June 30, 2025, the Group's finance costs decreased by 25.35% to HK$11,715 thousand from HK$15,707 thousand in the prior year, mainly due to reduced interest on bank and other borrowings and lease liabilities, coupled with increased capitalized interest Finance Costs Breakdown (Six Months Ended June 30) | Item | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Interest on bank and other borrowings | 16,289 | 16,616 | | Interest on lease liabilities | 59 | 1,537 | | Less: Interest capitalised | (4,633) | (2,446) | | Total finance costs | 11,715 | 15,707 | Income Tax Expense For the six months ended June 30, 2025, income tax expense significantly decreased by 47.81% to HK$8,875 thousand year-on-year, primarily comprising China corporate income tax calculated at a 25% rate, with no Hong Kong profits tax provision due to sufficient tax losses or no assessable profits Income Tax Expense (Six Months Ended June 30) | Item | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | | :--- | :--- | :--- | | China corporate income tax | 8,875 | 17,004 | | Hong Kong profits tax provision | – | – | - China corporate income tax rate is 25%[24] - Hong Kong profits tax two-tiered rates: 8.25% on the first HK$2 million of assessable profits and 16.5% on profits above that amount[25] Components of Profit for the Period Profit for the period is stated after deducting items such as depreciation of property, plant and equipment, depreciation of right-of-use assets, and cost of inventories sold and properties held for sale, with property, plant and equipment depreciation at HK$43,173 thousand and cost of inventories and properties sold at HK$310,753 thousand Profit for the Period Deductions (Six Months Ended June 30) | Item | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Depreciation of property, plant and equipment | 43,173 | 45,512 | | Depreciation of right-of-use assets | 2,002 | 4,292 | | Cost of inventories sold and properties held for sale | 310,753 | 318,606 | Dividends The Board of Directors does not recommend any interim dividend for the six months ended June 30, 2025 and 2024, while the 2024 final dividend of HK cents 2 per ordinary share, totaling HK$21,663 thousand, was paid, exceeding the HK cents 1 per share paid in 2023 - No interim dividend is recommended for the six months ended June 30, 2025 and 2024[27] Dividends Declared (Six Months Ended June 30) | Item | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | | :--- | :--- | :--- | | 2024 final dividend (2 HK cents per share) | 21,663 | N/A | | 2023 final dividend (1 HK cent per share) | N/A | 10,860 | Earnings Per Share For the six months ended June 30, 2025, basic earnings per share was HK cents 1.11, a 44.22% decrease from HK cents 1.99 in the prior year, with no diluted earnings per share presented due to the absence of potential dilutive ordinary shares Earnings Per Share Calculation (Six Months Ended June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Profit for the period attributable to owners of the Company (HK$ Thousand) | 11,979 | 21,659 | | Weighted average number of ordinary shares | 1,083,981,672 | 1,086,005,457 | | Basic earnings per share (HK cents) | 1.11 | 1.99 | - Diluted earnings per share is not presented as there are no potential dilutive ordinary shares[30] Trade and Other Receivables, Deposits and Prepayments As of June 30, 2025, total trade receivables decreased to HK$120,890 thousand from HK$143,791 thousand on December 31, 2024, primarily comprising receivables from hospital operations and elderly care related services, with the 0-30 day ageing category being the largest but showing a year-on-year reduction Trade and Other Receivables, Deposits and Prepayments (As at June 30) | Item | 2025 (HK$ Thousand) | 2024 December 31 (HK$ Thousand) | | :--- | :--- | :--- | | Trade receivables from hospital operations and elderly care related services | 128,655 | 150,141 | | Receivables from financial services | 876 | 876 | | Less: Provision for credit losses | (8,641) | (7,226) | | Net trade receivables | 120,890 | 143,791 | | Net deposits, prepayments and other receivables | 22,309 | 28,792 | Ageing Analysis of Trade Receivables (As at June 30) | Ageing | 2025 (HK$ Thousand) | 2024 December 31 (HK$ Thousand) | | :--- | :--- | :--- | | 0 – 30 days | 77,546 | 109,664 | | 31 – 60 days | 12,733 | 10,110 | | 61 – 90 days | 7,894 | 5,243 | | 91 – 365 days | 22,881 | 16,055 | | Over 365 days | 7,601 | 9,069 | | Total | 128,655 | 150,141 | Trade and Other Payables, Deposits, Accruals and Other Payables As of June 30, 2025, trade payables decreased to HK$108,171 thousand from HK$133,439 thousand on December 31, 2024, while current deposits, advances received, and accruals significantly declined, and non-current other payables included a new HK$37,239 thousand for construction payables Trade and Other Payables, Deposits, Accruals and Other Payables (As at June 30) | Item | 2025 (HK$ Thousand) | 2024 December 31 (HK$ Thousand) | | :--- | :--- | :--- | | Trade payables | 108,171 | 133,439 | | Current deposits, advances received and accruals | 321,374 | 450,111 | | Non-current other payables (construction payables) | 37,239 | – | Ageing Analysis of Trade Payables (As at June 30) | Ageing | 2025 (HK$ Thousand) | 2024 December 31 (HK$ Thousand) | | :--- | :--- | :--- | | 0 – 30 days | 42,847 | 59,973 | | 31 – 60 days | 30,184 | 38,855 | | 61 – 90 days | 11,066 | 8,154 | | 91 – 365 days | 15,592 | 13,767 | | Over one year but not over two years | 5,638 | 9,405 | | Over two years but not over five years | 2,844 | 3,285 | | Total | 108,171 | 133,439 | Litigation Tongren Medical, an indirect wholly-owned subsidiary, received a claim of approximately RMB143 million on July 30, 2024, which was dismissed by the court on December 26, 2024, but the claimant filed an appeal on January 9, 2025; as of June 30, 2025, the Company believes the lawsuit has no legal basis and no material impact on the Group's operations and financial position - Tongren Medical, an indirect wholly-owned subsidiary, received a claim of approximately RMB143 million from Jiaozuo City Investment Group Co Ltd on July 30, 2024[37] - The court dismissed the claim on December 26, 2024, but the claimant filed an appeal on January 9, 2025[37] - As of June 30, 2025, the Company believes the lawsuit has no legal basis and no material impact on the Group's operations and financial position[37] Management Discussion and Analysis This section provides an overview of the Group's financial performance, business review by segment, financial resources, capital structure, and future outlook Financial Performance Overview For the six months ended June 30, 2025, the Group's total revenue decreased by 4.67% to HK$783,132 thousand, and profit attributable to owners of the Company significantly decreased by 44.69% to HK$11,979 thousand, with basic earnings per share at HK cents 1.11 and net asset value per share at HK$1.68 Financial Performance Overview (Six Months Ended June 30) | Metric | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Total revenue | 783,132 | 821,529 | -4.67% | | Profit attributable to owners of the Company | 11,979 | 21,659 | -44.69% | | Basic earnings per share (HK cents) | 1.11 | 1.99 | -44.19% | - Profit decline primarily due to reduced revenue in the healthcare segment and increased non-cash fair value losses on investment properties, partially offset by lower employee benefit expenses, net exchange gains, and reduced income tax expense[39] - As of June 30, 2025, net asset value per share was HK$1.68 (December 31, 2024: HK$1.67)[40] Business Review The Group's principal businesses encompass healthcare, elderly care, property investment and development, securities trading and investment, financial services, and strategic investments; in the first half of 2025, the domestic healthcare and elderly care industries faced a complex and challenging operating environment, including policy adjustments, intensified market competition, and low consumer confidence - Principal businesses include investment, management and operation of healthcare and hospital businesses, elderly care businesses, trading of medical equipment and related supplies, property investment and development, securities trading and investment, provision of financial services, and strategic investments[41] - Domestic healthcare and elderly care institutions face a complex operating environment, affected by industry policy adjustments, intensified market competition, low consumer confidence, and other factors[41] Overall Business Environment In the first half of 2025, the domestic healthcare and elderly care industries faced multiple challenges, including policy adjustments, intensified market competition, low consumer confidence, technological changes, and economic uncertainty, leading to a general "chill" in the industry - The industry faces multiple challenges including policy adjustments, intensified market competition, low consumer confidence, technological changes, and economic uncertainty[41] Healthcare Segment Healthcare segment revenue decreased to HK$756,739 thousand, and profit fell to HK$57,559 thousand, with EBITDA at HK$102,248 thousand; Nanjing Hospital and Kunming Hospital made progress in operations, research, specialty development, and marketing, but overall business volume declined Healthcare Segment Financial Performance (Six Months Ended June 30) | Metric | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Revenue | 756,739 | 800,390 | | Profit | 57,559 | 82,250 | | EBITDA | 102,248 | 137,731 | - Nanjing Hospital's outpatient visits, inpatient admissions, and physical examination counts all decreased year-on-year[54] - Kunming Hospital's outpatient visits, inpatient admissions, and physical examination counts all slightly increased year-on-year[54] Nanjing Hospital Nanjing Hospital, a Grade III Class B general hospital, operates 43 clinical medical technology departments; during the review period, the hospital improved operational efficiency through cost control, human resource optimization, budget management, increased equipment self-repair rate, and marketing strategy adjustments, while scientific research progressed with an international cooperation project completed and multiple projects approved, specialty development advanced, and medical alliance collaborations were actively expanded - Nanjing Hospital operates 43 clinical medical technology departments, including national and provincial key specialties[43] - Operational management implemented cost control measures, optimized human resources, strengthened budget management, achieved a 96% equipment self-repair rate, and optimized marketing costs[44][45][46] - In scientific research, completed the "Nanjing Science and Technology Bureau International/Hong Kong, Macao and Taiwan Science and Technology Cooperation Project" and secured 16 approved projects[47] - Specialty development achieved acceptance for the Jiangsu Provincial Imaging Cloud Platform construction and promoted "medical rehabilitation-education integration" for disabled children[47] - Marketing promoted medical alliance co-construction and conducted corporate health popularization activities[48][49] Kunming Hospital Kunming Hospital, a Grade III Class A general hospital, operates 44 clinical medical technology departments; during the review period, scientific research reached a new high with 19 city-level continuing medical education projects approved, the Medical Laboratory Department passed ISO 15189 accreditation, and the International Medical Department made progress in foreign-related business, while marketing involved comprehensive promotion during medical festivals and "Health Carnival" interactive events, and the structural work for Kunming Hospital Phase II has been topped out with interior decoration underway - Kunming Hospital operates 44 clinical medical technology departments[50] - In scientific research, successfully applied for 19 city-level continuing medical education projects, a five-year high[51] - In specialty and department development, the Medical Laboratory Department passed ISO 15189 accreditation, and the International Medical Department made progress in foreign-related business[52][53] - Marketing involved comprehensive promotion around medical festivals and creating "Health Carnival" themed interactive events[53] - Kunming Hospital Phase II (including comprehensive inpatient building, oncology and nuclear medicine building, and rehabilitation medicine building) has achieved overall structural topping out, with interior decoration underway[54] Elderly Care Segment Elderly care segment revenue increased to HK$24,254 thousand, but recorded a loss of HK$32,066 thousand, mainly due to increased non-cash fair value losses on investment properties; Tiandi Health City sold 857 independent living units with over 390 residents, and 107 serviced apartments were leased, while elderly care homes continued to improve operational efficiency, and Deyu Hospital saw growth in outpatient visits and inpatient admissions Elderly Care Segment Financial Performance (Six Months Ended June 30) | Metric | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Revenue | 24,254 | 18,942 | | Loss | (32,066) | (25,735) | | Non-cash fair value loss on investment properties | (12,608) | (2,667) | | Provision for properties under development for sale | (4,834) | (6,147) | - Tiandi Health City sold 857 independent living units, with over 390 residents moved in[57] - Serviced apartments leased: 107 (December 31, 2024: 94)[57] - Deyu Hospital's outpatient visits and inpatient admissions both increased[59] Property Development Segment For the six months ended June 30, 2025, the property development business recorded zero revenue and a loss of HK$499 thousand, a narrower loss compared to HK$4,210 thousand in the same period of 2024, with the provision for properties under development for sale being zero Property Development Segment Financial Performance (Six Months Ended June 30) | Metric | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Revenue | – | – | | Loss | (499) | (4,210) | | Provision for properties under development for sale | – | (1,979) | - As of June 30, 2025, properties under development for sale amounted to HK$34,230 thousand[61] Property Investment Segment For the six months ended June 30, 2025, the property investment segment generated rental income of HK$2,139 thousand but recorded a loss of HK$12,212 thousand, with the loss widening year-on-year, primarily due to increased non-cash fair value losses on investment properties Property Investment Segment Financial Performance (Six Months Ended June 30) | Metric | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Rental income | 2,139 | 2,197 | | Loss | (12,212) | (6,096) | | Non-cash fair value loss on investment properties | (13,136) | (9,130) | - As of June 30, 2025, the carrying value of the investment property portfolio was HK$184,104 thousand[62] Securities Trading and Investment Segment During the review period, the securities trading and investment business recorded zero revenue but a gain of HK$53 thousand, an improvement from the HK$363 thousand loss in the same period of 2024, mainly due to fair value gains on investments held for trading; the investment portfolio is primarily distributed in Hong Kong, Australia, and the Philippines, with a focus on property and construction industries Securities Trading and Investment Segment Financial Performance (Six Months Ended June 30) | Metric | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Revenue | – | – | | Gain/(Loss) | 53 | (363) | | Fair value gains/(losses) on investments held for trading | 77 | (326) | Geographical Distribution of Investments Held for Trading Portfolio (As at June 30) | Geographical Location | 2025 Carrying Value (HK$ Thousand) | Percentage of Total Assets (%) | | :--- | :--- | :--- | | Hong Kong | 3,718 | 0.11% | | Australia | 947 | 0.03% | | Philippines | 363 | 0.01% | | Total | 5,028 | N/A | Principal Business of Investments Held for Trading Portfolio (As at June 30) | Principal Business | 2025 Carrying Value (HK$ Thousand) | Percentage of Total Assets (%) | | :--- | :--- | :--- | | Entertainment & Media | 423 | 0.01% | | Financial Services & Investment | 79 | 0.00% | | Industrial Materials | 257 | 0.01% | | Property & Construction | 4,269 | 0.12% | | Total | 5,028 | N/A | Financial Services Segment During the review period, the money lending business generated no interest income and recorded a loss of HK$2 thousand, a significant reduction from the HK$18 thousand loss in the same period of 2024; as of June 30, 2025, the carrying value of loans receivable was zero, with a full impairment provision made, and the Group manages its money lending business through stringent credit assessment and risk management policies Financial Services Segment Financial Performance (Six Months Ended June 30) | Metric | 2025 (HK$ Thousand) | 2024 (HK$ Thousand) | | :--- | :--- | :--- | | Interest income | – | – | | Loss | (2) | (18) | | Carrying value of loans receivable (after impairment provision) | – | – | - The Group prudently made a full impairment loss provision for the loan in 2021[69] Business Model and Customer Information The financial services segment provides secured and unsecured term loans to diversify revenue streams and business risks, aiming for stable returns for the Group, with funding primarily from internal resources and borrowings, and customers referred through company or business networks without specific industry or revenue targets - Provides secured and unsecured term loans to diversify revenue streams and business risks[70] - Funding sources primarily include internal resources and borrowings[70] - Customers are referred through company or business networks, with no specific industry or annual revenue targets for corporate clients[70] Risk Management Policies The Group adopts comprehensive credit assessment and approval procedures, evaluating loan transactions on a case-by-case basis; the finance and accounting department conducts background checks, reviews financial conditions, inquires about loan purposes and repayment sources, and assesses credit risk and collateral value, with loan transactions approved by the Board or Executive Committee and repayment progress regularly monitored - Adopts comprehensive credit assessment and approval procedures, evaluating loan transactions on a case-by-case basis[71] - Finance and accounting department conducts background checks, reviews financial conditions, inquires about loan purposes and repayment sources, and assesses credit risk and collateral value[71] - Loan transactions are approved by the Board or Executive Committee, with repayment progress regularly monitored[71] Loan Impairment Policies The Group adopts the Expected Credit Loss (ECL) policy under HKFRS 9, regularly reviewing the recoverability of loans and making adequate provisions; ECL assessment is based on historical credit loss experience, adjusted for specific borrower factors and forward-looking information, to identify significant increases in credit risk - Adopts the Expected Credit Loss (ECL) policy under HKFRS 9[72] - ECL assessment is based on historical credit loss experience, adjusted for specific borrower factors and forward-looking information (including economic conditions)[72] - Regularly monitors and revises criteria for identifying significant increases in credit risk as appropriate[72] Financial Resources and Capital Structure As of June 30, 2025, the Group's non-current assets were HK$2,196,056 thousand, primarily funded by shareholders' equity; total borrowings increased to HK$866,809 thousand, with a gearing ratio of 2.3%, and the company completed a share premium account reduction in 2024 and a rights issue in 2023 Non-current Assets Composition (As at June 30) | Item | 2025 (HK$ Thousand) | 2024 December 31 (HK$ Thousand) | | :--- | :--- | :--- | | Investment properties | 503,116 | 525,392 | | Property, plant and equipment | 1,591,237 | 1,541,635 | | Right-of-use assets | 84,853 | 86,605 | | Financial assets at fair value through profit or loss | 2,151 | 2,151 | | Prepayments for acquisition of property, plant and equipment | 14,699 | 23,887 | | Total non-current assets | 2,196,056 | 2,179,670 | Total Borrowings Composition and Repayment Terms (As at June 30) | Item | 2025 (HK$ Thousand) | 2024 December 31 (HK$ Thousand) | | :--- | :--- | :--- | | Secured bank borrowings | 72,053 | 35,123 | | Unsecured bank borrowings | 387,063 | 395,050 | | Unsecured term loans | 407,693 | 403,210 | | Total borrowings | 866,809 | 833,383 | | Repayable within one year | 418,329 | 390,817 | | Repayable after one year but within two years | 444,050 | 442,566 | | Repayable after two years but within five years | 4,430 | – | - Gearing ratio (net borrowings divided by total equity) was 2.3% (December 31, 2024: no gearing ratio)[75] - In May 2024, the share premium account was reduced by HK$2,600,000 thousand to offset accumulated losses, with the remaining HK$327,046 thousand transferred to the contributed surplus account[75] - In June 2023, a rights issue was completed, raising approximately HK$318.6 million (before expenses)[76] Net Proceeds from Rights Issue Utilisation (As at June 30, 2025) | Intended Use | Net Proceeds Planned (HK$ Thousand) | Utilised (HK$ Thousand) | Unutilised Balance (HK$ Thousand) | Expected Utilisation Timeline | | :--- | :--- | :--- | :--- | :--- | | Investment opportunities | 200,000 | – | 200,000 | End of 2027 | | General working capital | 47,792 | – | 47,792 | End of 2026 | | Share repurchases | 61,500 | – | 61,500 | End of 2026 | | Total | 309,292 | – | 309,292 | N/A | - The Group's primary functional currencies are HKD, RMB, AUD, and USD, and it will closely monitor foreign exchange risks and consider hedging[78] Pledge of Group Assets As of June 30, 2025, certain Group assets were pledged to banks and securities brokers to secure credit facilities, including investments held for trading, buildings, right-of-use assets, investment properties, pledged bank deposits, and medical equipment Pledged Group Assets (As at June 30) | Asset Category | 2025 (HK$ Thousand) | 2024 December 31 (HK$ Thousand) | | :--- | :--- | :--- | | Investments held for trading | 5,028 | 4,951 | | Buildings (included in property, plant and equipment) | 557,034 | – | | Right-of-use assets | 15,082 | – | | Investment properties | 13,297 | 13,043 | | Pledged bank deposits | 8,791 | – | | Medical equipment (included in property, plant and equipment) | 14,181 | 14,883 | Capital Commitments As of June 30, 2025, the Group's contracted but unprovided capital commitments for the acquisition of property, plant and equipment amounted to HK$95,834 thousand, a decrease from HK$133,747 thousand on December 31, 2024 Capital Commitments (As at June 30) | Item | 2025 (HK$ Thousand) | 2024 December 31 (HK$ Thousand) | | :--- | :--- | :--- | | Capital commitments for acquisition of property, plant and equipment | 95,834 | 133,747 | Contingent Liabilities As of June 30, 2025, the Group had no other significant contingent liabilities apart from the litigation disclosed in this announcement - No other significant contingent liabilities apart from the disclosed litigation[81] Significant Acquisitions and Disposals and Future Plans For the six months ended June 30, 2025, the Group did not undertake any other significant investments, acquisitions, or disposals of subsidiaries, associates, and joint ventures, nor did it have any significant investment or capital asset plans - No significant investments, acquisitions, or disposals of subsidiaries, associates, and joint ventures during the review period[82] - As of June 30, 2025, there were no significant investment or capital asset plans[82] Employees As of June 30, 2025, the Group's total number of employees increased to 2,694 from 2,626 on December 31, 2024, and the company regularly reviews its remuneration policy to ensure alignment with market conditions and individual performance Number of Employees | Date | Number of Employees | | :--- | :--- | | June 30, 2025 | 2,694 | | December 31, 2024 | 2,626 | - Remuneration policy is aligned with market conditions and individual performance, and is regularly reviewed[83] Outlook The Group will continue to focus on strengthening healthcare content, activating operational capabilities, and solidifying cost reduction and efficiency improvement; the elderly care segment will build smart elderly care communities and enhance rehabilitation departments, while facing a continuously challenging business environment, the Group will maintain a cautious approach, closely review, and adjust its business and investment strategies - The Group will continue to focus on strengthening healthcare content, activating operational capabilities, and solidifying cost reduction and efficiency improvement[84] - Facing global trade tensions, geopolitical conflicts, low consumer confidence, and economic slowdown, the Group will maintain a cautious approach and adjust its business and investment strategies[87] Healthcare Segment Outlook The healthcare segment will focus on business development to reverse the decline and achieve performance growth; Nanjing Hospital will stabilize advantageous disciplines and strengthen external cooperation, while Kunming Hospital will solidify core services and expand external business, aiming to become a medical destination for ASEAN, with both hospitals committed to utilizing innovative technologies and prioritizing cost control - Nanjing Hospital will stabilize advantageous disciplines such as ophthalmology, ENT, and stomatology, strengthen operational capabilities, increase high-value-added projects, and enhance external cooperation with public and grassroots institutions[84][85] - Kunming Hospital will solidify advantageous specialties like cardiology, cardiothoracic surgery, and gynecology, support new business development, integrate into the Belt and Road Initiative, expand external business, and aim to become a medical destination for ASEAN countries[84][85] - Both hospitals are committed to utilizing innovative technologies to enhance diagnosis and treatment, improve patient care, and continuously optimize human resource structure and resource utilization to strengthen cost control[85] Elderly Care Segment Outlook The elderly care segment plans to build smart elderly care communities, enhance member services, implement precise dietary management, and launch community home-based elderly care services; property management will strengthen safety, and nursing homes will bolster rehabilitation departments, refine rehabilitation services, complete new bed construction, and continue developing three distinctive features: rehabilitation, nursing, and dementia care - In community operations, plans include building smart elderly care communities, increasing member services, implementing precise dietary management, expanding club categories, and launching community home-based elderly care services[86] - In property management services, focus will be on strengthening safety management, advancing fire facility renovations, and gradually taking over hospital property management operations[86] - In nursing home operations, efforts will be made to strengthen rehabilitation departments, complete the construction of new beds on the first floor, and continuously promote the three distinctive features: rehabilitation, nursing, and dementia care[86] Other Business Outlook Amidst global trade tensions, geopolitical conflicts, low consumer confidence, and economic slowdown, the Group will maintain a cautious approach, closely review and adjust its business and investment strategies and overall investment portfolio to adapt to challenges and create higher value and returns for shareholders - The business environment remains challenging, and the Group will maintain a cautious approach[87] - Will closely review and adjust business and investment strategies and the overall investment portfolio to adapt to challenges and create higher value and returns for shareholders[87] Other Information This section covers corporate governance, audit committee review, share repurchases, and changes in the nomination committee role Corporate Governance Code For the six months ended June 30, 2025, the Company has applied and consistently complied with the Corporate Governance Code in Appendix C1 of the Listing Rules - The Company has applied and consistently complied with the Corporate Governance Code in Appendix C1 of the Listing Rules[88] Review by Audit Committee The Audit Committee, in conjunction with management, reviewed the Group's accounting principles and practices, discussed internal controls and financial reporting matters, including a general review of the interim report, relying on the external auditor's findings and management's report without conducting a detailed independent audit review - The Audit Committee reviewed accounting principles, internal controls, and financial reporting matters, including a general review of the interim report[89] - The review relied on the findings of the external auditor (BDO Limited) and management's report[89] - The Audit Committee did not conduct a detailed independent audit review[89] Purchase, Sale or Redemption of Shares During the six months ended June 30, 2025, the Company repurchased a total of 1,965,000 shares on the Stock Exchange for a total consideration of HK$1,532,600, and all repurchased shares have been cancelled Share Repurchase Details (Six Months Ended June 30) | Month | Number of Shares | Highest Purchase Price (HK$) | Lowest Purchase Price (HK$) | Total Consideration (Excluding Expenses) (HK$) | | :--- | :--- | :--- | :--- | :--- | | March | 180,000 | 0.76 | 0.74 | 136,600 | | April | 1,485,000 | 0.78 | 0.77 | 1,158,250 | | May | 40,000 | 0.75 | 0.75 | 30,000 | | June | 260,000 | 0.81 | 0.78 | 207,750 | | Total | 1,965,000 | N/A | N/A | 1,532,600 | - All repurchased shares have been cancelled[90] Re-designation of Nomination Committee Role Dr Wong Wing Kuen will succeed Mr Kong Muk Yin as the Chairman of the Nomination Committee effective August 1, 2025, with Mr Kong Muk Yin remaining a member of the committee after the re-designation - Dr Wong Wing Kuen will succeed Mr Kong Muk Yin as the Chairman of the Nomination Committee effective August 1, 2025[92] - Mr Kong Muk Yin will remain a member of the Nomination Committee after the re-designation[92]