自然美(00157) - 2025 - 中期业绩

Interim Results Announcement and Proposals This section covers the unaudited interim results, proposed adoption of a new share option scheme, amendments to Share Award Scheme II, and the current composition of the Board of Directors Interim Results Announcement Natural Beauty Bio-Technology Limited is pleased to announce its unaudited consolidated results for the six months ended June 30, 2025, with the printed interim report to be dispatched in August 2025 and available on the HKEX and company website - The company announced its unaudited consolidated results for the six months ended June 30, 2025[2] - The printed interim report will be dispatched in August 2025 and available on the HKEX and company website[2] Proposed Adoption of 2025 Share Option Scheme To continue the share option scheme and incentivize eligible individuals contributing to the Group, the Board proposes adopting a new 2025 Share Option Scheme with a ten-year validity, subject to EGM approval and HKEX Listing Committee consent for listing and trading of option shares - The Board proposes adopting a new 2025 Share Option Scheme with a ten-year validity to incentivize and reward contributors[3] - The scheme's effectiveness is subject to shareholder approval by ordinary resolution at an EGM and HKEX Listing Committee approval for listing and trading of option shares[4] Proposed Amendments to Share Award Scheme II The Board proposes amending Share Award Scheme II to allow new share issuance for new grants and expand eligible participants to include company distributors, subject to EGM approval and HKEX Listing Committee consent for listing and trading of award shares - Amendments to Share Award Scheme II are proposed to allow new share issuance and expand eligible participants to include company distributors[5] - The amendments' effectiveness is subject to shareholder approval by ordinary resolution at an EGM and HKEX Listing Committee approval for listing and trading of award shares[5] Board of Directors Composition As of August 5, 2025, the Board comprises three executive directors (including Dr. Ray Chen, Chairman), two non-executive directors, and three independent non-executive directors - The Board of Directors consists of Dr. Ray Chen (Chairman), Mr. Lin Chia-Wei, Ms. Lin Yen-Ling (Executive Directors); Ms. Lin Shu-Hua, Mr. Chen Shou-Huang (Non-Executive Directors); and Mr. Chen Ruey-Long, Mr. Lin Tsang-Hsiang, Mr. Yang Shih-Chien (Independent Non-Executive Directors)[7] Corporate Information This section details the company's board and committee structures, key personnel changes, and essential corporate information including registered office, auditors, legal advisors, and banking relationships Board and Committees As of August 5, 2025, the company's Board comprises executive, non-executive, and independent non-executive directors, with established Audit, Remuneration, Executive, and Nomination Committees, all chaired by independent non-executive directors except for the Executive Committee - Board members include Executive Directors Dr. Ray Chen (Chairman), Mr. Lin Chia-Wei, Ms. Lin Yen-Ling; Non-Executive Directors Ms. Lin Shu-Hua, Mr. Chen Shou-Huang; and Independent Non-Executive Directors Mr. Chen Ruey-Long, Mr. Yang Shih-Chien, Mr. Lin Tsang-Hsiang[9] - The Audit Committee is chaired by Mr. Chen Ruey-Long, the Remuneration Committee by Mr. Lin Tsang-Hsiang, the Nomination Committee by Mr. Yang Shih-Chien, and the Executive Committee by Dr. Ray Chen[11][12] Key Personnel Changes Ms. Kuo Yen-Ting resigned as authorized representative and company secretary on August 5, 2025, with Ms. Li Mei-Yi appointed as her successor on the same day - Ms. Kuo Yen-Ting resigned as authorized representative and company secretary on August 5, 2025[10] - Ms. Li Mei-Yi was appointed as authorized representative and company secretary on August 5, 2025[10] Company Details and Contacts The company's registered office is in the Cayman Islands, with its principal place of business in Hong Kong at Lee Garden One, Causeway Bay. RSM Hong Kong is the auditor, and Jingtian & Gongcheng is the Hong Kong legal advisor. The principal share registrar is in the Cayman Islands, with Hong Kong branch being Hong Kong Central Securities Registrars Limited. The company's stock code is 00157, and its principal bankers include HSBC, King's Town Bank, CTBC Bank, China Merchants Bank, Bank of Communications, and E.SUN Bank - The registered office is in the Cayman Islands, with the principal place of business in Hong Kong at Lee Garden One, Hysan Avenue, Causeway Bay[13][14] - RSM Hong Kong is the auditor, and Jingtian & Gongcheng is the Hong Kong legal advisor[14][15] - The company's stock code is 00157, and its principal bankers include HSBC, King's Town Bank, CTBC Bank, China Merchants Bank, Bank of Communications, and E.SUN Bank[17][18][19] Management Discussion and Analysis This section provides a comprehensive review of the Group's financial performance, business operations, and future outlook for 2025, highlighting key market strategies and operational achievements Financial Review For the six months ended June 30, 2025, the Group's turnover increased by 68.7% year-on-year to HK$264.5 million, driven by strong growth in the PRC market, achieving a profit before tax of HK$12.5 million from a loss, while maintaining a solid liquidity position despite a slight decrease in gross profit margin due to product mix changes 2025 H1 Turnover Overview | Metric | 2025 H1 (HK$ thousand) | 2024 H1 (HK$ thousand) | Change (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Total Turnover | 264,504 | 156,749 | 107,755 | 68.7% | | PRC Turnover | 216,872 | 107,833 | 109,039 | 101.1% | | Taiwan Turnover | 45,943 | 45,953 | (10) | 0.0% | | Other Regions Turnover | 1,689 | 2,963 | (1,274) | -43.0% | - The Group's overall gross profit margin decreased from 59.5% in 2024 H1 to 55.6% in 2025 H1, primarily due to changes in the revenue mix from product bundle sales in the PRC market[25][26] - Profit before tax turned from a loss of HK$28.7 million in 2024 H1 to a profit of HK$12.5 million in 2025 H1, representing a 143.6% increase[42][47] - Profit for the period turned from a loss of HK$30.5 million in 2024 H1 to a profit of HK$10.9 million in 2025 H1, representing a 135.7% increase[43][48] Turnover by Geographical Region In 2025 H1, the Group's total turnover increased by 68.7% year-on-year, with the PRC market turnover growing by 101.1% to HK$216.9 million, accounting for 82.0% of total turnover; Taiwan market turnover remained largely flat; and sales in other regions decreased by 43.0% 2025 H1 Turnover by Geographical Region | Region | 2025 H1 (HK$ thousand) | % of Total | 2024 H1 (HK$ thousand) | % of Total | Change (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | PRC | 216,872 | 82.0% | 107,833 | 68.8% | 109,039 | 101.1% | | Taiwan | 45,943 | 17.4% | 45,953 | 29.3% | (10) | 0.0% | | Others | 1,689 | 0.6% | 2,963 | 1.9% | (1,274) | -43.0% | | Total | 264,504 | 100% | 156,749 | 100.0% | 107,755 | 68.7% | Turnover by Activities In 2025 H1, product sales increased by 68.8% year-on-year to HK$262.6 million, accounting for 99.3% of total revenue, primarily driven by a 100.9% growth in product sales in the PRC market, while service income grew by 67.3% to HK$1.9 million 2025 H1 Turnover by Activities | Activity | 2025 H1 (HK$ thousand) | % of Total | 2024 H1 (HK$ thousand) | % of Total | Change (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Products | 262,625 | 99.3% | 155,626 | 99.3% | 106,999 | 68.8% | | Services | 1,879 | 0.7% | 1,123 | 0.7% | 756 | 67.3% | | Total | 264,504 | 100% | 156,749 | 100.0% | 107,755 | 68.7% | - The increase in product sales was primarily due to a 100.9% growth in turnover for this segment in the PRC market, reaching HK$215.2 million[29][32] - Service income primarily derived from self-operated spa services, training, and other services, with the Group owning six self-operated spa centers in the PRC[30][33] Other Income and Other Gains In 2025 H1, other income and other gains decreased by 47.4% year-on-year to HK$2 million, primarily comprising rental income, government grants, and interest income 2025 H1 Other Income and Other Gains | Metric | 2025 H1 (HK$ thousand) | 2024 H1 (HK$ thousand) | Change (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Other Income and Gains | 2,000 | 3,800 | (1,800) | -47.4% | - Key components include rental income of HK$0.6 million, government grants of HK$0.4 million, and interest income of HK$0.3 million[34][38] Selling and Administrative Expenses In 2025 H1, distribution and selling expenses as a percentage of turnover decreased to 35.1%, with the total increasing by HK$10.8 million to HK$92.8 million, mainly due to higher wages and travel expenses, while total administrative expenses decreased by 12.9% year-on-year to HK$33.9 million - Distribution and selling expenses as a percentage of turnover decreased from 52.3% in 2024 H1 to 35.1% in 2025 H1[35][39] - Distribution and selling expenses increased by HK$10.8 million to HK$92.8 million, primarily due to a HK$9.1 million increase in wages and a HK$1.3 million increase in travel expenses[35][39] - Total administrative expenses decreased by HK$5 million or 12.9% to HK$33.9 million, mainly comprising staff costs and retirement benefits, depreciation expenses, consulting and professional fees, and research and development expenses[37][40] Other Expenses and Other Losses In 2025 H1, other expenses and other losses increased by HK$5.4 million year-on-year to HK$6.4 million, primarily including exchange losses of HK$4.2 million and losses on disposal of fixed assets of HK$1.3 million 2025 H1 Other Expenses and Other Losses | Metric | 2025 H1 (HK$ thousand) | 2024 H1 (HK$ thousand) | Change (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Other Expenses and Losses | 6,400 | 1,000 | 5,400 | 540.0% | | Of which: Exchange losses | 4,200 | - | - | - | | Loss on disposal of fixed assets | 1,300 | - | - | - | Liquidity and Financial Resources As of June 30, 2025, the Group's cash used in operating activities was approximately HK$14 million, with cash and cash equivalents at approximately HK$93.5 million, maintaining a solid liquidity position with a gearing ratio of 41.4% and a current ratio of 1.45 times - Cash used in operating activities in 2025 H1 was approximately HK$14 million, an improvement from HK$26.5 million in 2024 H1[44][49] Liquidity and Financial Resources Metrics | Metric | June 30, 2025 (HK$ thousand) | Dec 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Cash and Cash Equivalents | 93,500 | 109,000 | | External Bank Borrowings | 200,900 | 192,200 | | Gearing Ratio | 41.4% | 43.0% | | Current Ratio | 1.45x | 1.54x | - The Group has no significant contingent liabilities and maintains a solid liquidity position[45][49] Treasury Policies and Exchange Rate Exposure The Group's majority of revenue is denominated in RMB and NTD. As of June 30, 2025, approximately 29.4% of bank balances and cash were in RMB and 52.3% in NTD, with the Group adopting prudent foreign exchange risk management policies and using derivative financial instruments for hedging when necessary - The Group's majority of revenue is denominated in RMB and NTD, with principal operations in the PRC and Taiwan[50][51] Bank Balances and Cash Currency Composition as of June 30, 2025 | Currency | % of Total as of June 30, 2025 | % of Total as of Dec 31, 2024 | | :--- | :--- | :--- | | RMB | 29.4% | 46.0% | | NTD | 52.3% | 38.2% | | Others (USD, HKD, MYR) | 18.3% | 15.8% | - The Group regularly reviews foreign exchange risks and uses derivative financial instruments for hedging when necessary[50][51] Business Review In 2025 H1, the Group achieved strong growth in the PRC market and stable performance in Taiwan. Distribution channels saw significant sales growth from franchised/self-operated spas and counters, with a substantial increase in new store openings. R&D focused on anti-aging innovation, smart instruments, and exosome technology, applying AI to massage robots. Health food business performed exceptionally, growing by 109.3% year-on-year - PRC market turnover increased by 101.1% year-on-year to HK$216.9 million, but product sales gross profit margin decreased from 61.5% to 56.0%, mainly due to changes in product revenue mix[54][57] - Taiwan market turnover remained largely flat, with product sales gross profit margin increasing from 55.9% to 56.3%, primarily due to changes in revenue mix from business channel shifts[55][58] - Sales from franchised/self-operated spas and department store counters increased by HK$108.7 million to HK$243 million, accounting for 91.9% of total turnover[56][59] - In 2025 H1, the Group opened 244 new stores and closed 59 stores[65][69] - R&D focuses on anti-aging innovation upgrades (NB-1 Diamond Peptide Series), smart instrument applications (AI skin detection device), and exosome technology deepening, alongside the development of AI massage robots[66][67][68][70][71][72][73][76] - Health food series achieved revenue of HK$28 million, a year-on-year increase of 109.3%, becoming a high-growth engine in the wellness sector[80][82] The PRC Market In 2025 H1, the PRC market turnover increased by 101.1% year-on-year to HK$216.9 million. Product sales gross profit margin decreased from 61.5% to 56.0%, mainly due to changes in the revenue mix from product bundle sales PRC Market Turnover and Gross Profit Margin | Metric | 2025 H1 (HK$ thousand) | 2024 H1 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Turnover | 216,900 | 107,800 | 101.1% | | Product Sales Gross Profit Margin | 56.0% | 61.5% | -5.5%pt | Taiwan Market In 2025 H1, Taiwan market turnover was HK$46 million, largely flat year-on-year. Product sales gross profit margin increased from 55.9% to 56.3%, mainly due to changes in revenue mix from business channel shifts Taiwan Market Turnover and Gross Profit Margin | Metric | 2025 H1 (HK$ thousand) | 2024 H1 (HK$ thousand) | Change (%) | | :--- | :--- | :--- | :--- | | Turnover | 46,000 | 46,000 | 0.0% | | Product Sales Gross Profit Margin | 56.3% | 55.9% | +0.4%pt | Distribution Channels In 2025 H1, sales from franchised/self-operated spas and department store counters increased by HK$108.7 million to HK$243 million, accounting for 91.9% of total revenue, while e-commerce, TV shopping, and telemarketing channels saw a slight decline. As of June 30, 2025, the Group had 1,958 spa centers and 7 counters, with 1,952 being franchised spas, opening 244 new stores and closing 59 during the period 2025 H1 Turnover by Distribution Channel | Channel | 2025 H1 (HK$ thousand) | % of Total | 2024 H1 (HK$ thousand) | % of Total | Change (HK$ thousand) | | :--- | :--- | :--- | :--- | :--- | :--- | | Franchised/Self-operated Spas & Counters | 243,000 | 91.9% | 134,300 | 85.7% | 108,700 | | E-commerce, TV Shopping & Telemarketing | 21,500 | 8.1% | 22,400 | 14.3% | (900) | Number of Stores as of June 30, 2025 | Region | Franchised Spas | Self-operated Spas | Self-operated Counters | Total | | :--- | :--- | :--- | :--- | :--- | | PRC | 1,640 | 6 | 7 | 1,653 | | Taiwan | 293 | – | – | 293 | | Others | 19 | – | – | 19 | | Total | 1,952 | 6 | 7 | 1,965 | - During the period, 244 new stores were opened, and 59 stores were closed[65][69] Research and Development In 2025, Natural Beauty's core R&D strategy focuses on advanced technology and high-end formula upgrades, emphasizing anti-aging innovation, smart instrument applications, and exosome technology. The NB-1 Diamond Peptide Series was successfully upgraded, an enhanced skin detection device with AI skin texture recognition was launched, and an AI massage robot with visual recognition was developed. Over 20 exosome products are expected to be launched throughout the year, with active promotion of industry-academia collaboration - R&D strategy focuses on anti-aging innovation upgrades, smart instrument applications, and exosome technology deepening[66][70] - Completed comprehensive technology and formula upgrades for the flagship "Diamond Peptide Series", targeting mature skin issues in Asian women[67][70] - Launched an upgraded skin detection device, equipped with a 100x magnifying lens and an AI skin texture recognition model, already introduced in multiple franchised stores[68][70] - Exosome technology is a key focus for annual expansion, with over 20 products expected to be launched across multiple channels[72][76] - Successfully developed an AI massage robot with visual recognition capabilities, capable of simulating professional manual techniques for standardized operations[73][76] Products and Marketing Activities In April 2025, Natural Beauty held a "Diamond Peptide & Health Food" new product launch, introducing various skincare, health food, and hair care products, achieving HK$58 million in sales. The company fully implemented a standardized sales conference tour strategy, hosting over 90 themed events to effectively strengthen brand recognition. Health food series revenue reached HK$28 million, a 109.3% year-on-year increase. Additionally, a partnership with Kid Castle Educational Group led to the establishment of "Bio–up Fanity" biotechnology beauty SPA clubs, pioneering a cross-industry integration model - The April 2025 new product launch introduced 6 skincare items, 2 Diamond skincare gift sets, 5 health food products, and 4 hair care products, achieving HK$58 million in sales performance[78][79][82] - Fully implemented a standardized sales conference tour strategy, hosting over 90 themed events to strengthen brand recognition and product stickiness within the franchised chain system[80][82] - Health food series revenue reached HK$28 million, a year-on-year increase of 109.3%, solidifying its position as a high-growth engine in the wellness sector[80][82] - Strategic cooperation with Kid Castle Educational Group led to the establishment of the first "Bio–up Fanity" biotechnology beauty SPA club in Xi'an, Shaanxi, with 4 locations completed, targeting young parents of children[81][83] Human Resources As of June 30, 2025, the Group employed a total of 525 employees, with 424 in the PRC and 101 in Taiwan. Total remuneration for 2025 H1 was approximately HK$74.9 million, a 17.0% year-on-year increase, including HK$11.8 million in retirement benefit-related costs. The Group is committed to employee training and development and maintains a competitive compensation package Human Resources Overview | Metric | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Total Employees | 525 persons | - | | PRC Employees | 424 persons | - | | Taiwan Employees | 101 persons | - | | Total Remuneration (HK$ thousand) | 74,900 | 64,000 | | Retirement Benefit Related Costs (HK$ thousand) | 11,800 | 10,000 | - The Group maintains good cooperative relationships with employees, regularly providing professional training courses[85][89] Capital Expenditure In 2025 H1, the Group's capital expenditure was HK$33.2 million, primarily allocated to new factory construction in the PRC (HK$19.4 million) and new store renovations and equipment (HK$10.4 million) 2025 H1 Capital Expenditure | Item | Amount (HK$ thousand) | | :--- | :--- | | Total Capital Expenditure | 33,200 | | New Factory Construction in PRC | 19,400 | | New Store Renovation & Equipment | 10,400 | Right-of-use Assets and Lease Liability As of June 30, 2025, the Group's right-of-use assets amounted to HK$36.3 million and lease liabilities to HK$21.4 million, primarily located in the PRC and Taiwan. Depreciation expense for right-of-use assets was HK$3.8 million, and interest expense on lease liabilities was HK$0.6 million during the period Right-of-Use Assets and Lease Liabilities Overview | Metric | June 30, 2025 (HK$ thousand) | June 30, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Right-of-Use Assets | 36,300 | 28,300 | | Lease Liabilities | 21,400 | 12,800 | | Depreciation Expense for Right-of-Use Assets (Period) | 3,800 | - | | Interest Expense on Lease Liabilities (Period) | 600 | - | Pledged Assets As of June 30, 2025, the Group's secured short-term and long-term bank borrowings were collateralized by certain freehold land, buildings, and right-of-use assets related to leasehold land with a carrying value of HK$336.8 million - Secured bank borrowings are collateralized by land, buildings, and right-of-use assets with a carrying value of HK$336.8 million[88][92] Outlook for 2025 2025 is a pivotal year for Natural Beauty to achieve structural breakthroughs, as the company will continue to deepen its presence in the wellness sector, expand diversified businesses, and accelerate the deployment of its agent system, focusing on five core regions. In H1, new franchised stores in the PRC increased by 88.1% year-on-year, with steady growth in single-store revenue. In H2, the company will continue to implement its "AI Technology, Beauty, and Holistic Health" strategy, collaborating with Baidu and Fudan University to strengthen brand building, deepen membership system operations, and fully accelerate core business development - 2025 is a crucial year for Natural Beauty to achieve structural breakthroughs, continuing to deepen its presence in the wellness sector and expand diversified businesses[93][95] - Accelerate the deployment of the agent system, focusing on five core regions: Central China, East China, West, South China, and North China[93][95] - In 2025 H1, the number of new franchised stores in the PRC increased by 88.1% year-on-year, with steady growth in single-store revenue[93][95] - In H2, the company will implement the "AI Technology, Beauty, and Holistic Health" strategy, strategically collaborating with Baidu and Fudan University to leverage AI technology's core empowering role in product innovation, digital stores, marketing, and management system upgrades[97][98] Key Market Development Strategies - Taiwan In 2025 H1, the Taiwan market continued to implement a dual-track strategy of "multi-channel marketing" and "high repurchase products," flexibly integrating online and offline momentum. Despite economic fluctuations, operational performance remained stable. The company actively deployed AI technology beauty instruments to assist franchised stores in upgrading, and expanded brand reach through live streaming, social interaction, and other digital promotions, laying the foundation for full-year performance growth - The Taiwan market continues to advance a dual-track strategy of "multi-channel marketing" and "high repurchase products", integrating online platforms and physical store momentum[94][96] - Actively deploying AI technology beauty instruments to assist franchised stores in upgrading their profit models and strengthening terminal competitiveness[94][96] - Expanding brand reach through live streaming, social interaction, and digital promotions to drive traffic conversion[94][96] Key Market Development Strategies - PRC The PRC market continues to implement multi-channel, multi-brand strategies, deepening its presence in the beauty and wellness sector, and accelerating store deployment through an agent system. Marketing efforts advance an integrated "online live streaming + offline conference" strategy, deeply covering key national regions. In brand building, the B.U.T. ESSE brand continues to expand its channel footprint, successfully implementing a "counter × beauty salon" dual-mode operation model to enhance brand influence - Continues to implement multi-channel, multi-brand strategies, deepening its presence in the beauty and wellness sector, and accelerating store deployment through an agent system[97][98] - Marketing advances an integrated "online live streaming + offline conference" strategy to comprehensively improve market penetration efficiency and deeply cover key national regions[97][98] - Deep collaboration with local core agents to rapidly advance localized business implementation and expansion[97][98] - The B.U.T. ESSE brand continues to expand its channel footprint, opening counters at Xujiahui Oriental Commercial Building and deploying self-operated beauty salons in core business districts like New World and Hopson One, successfully implementing a "counter × beauty salon" dual-mode operation model[97][98] Corporate Governance Highlights This section outlines the company's commitment to high-level corporate governance, detailing the roles and responsibilities of its Board committees, compliance with governance codes, and recent changes in directors' and CEO's information Commitment to Corporate Governance The company is committed to achieving high-level corporate governance to protect and enhance shareholder interests. The Board has established Audit, Executive, Remuneration, and Nomination Committees, whose terms of reference comply with the Listing Rules' Corporate Governance Code, and all but the Executive Committee are chaired by independent non-executive directors - The company is committed to achieving a high level of corporate governance to properly safeguard and enhance shareholder interests[99][104] - The Board has established an Audit Committee, Executive Committee, Remuneration Committee, and Nomination Committee, whose terms of reference comply with the Corporate Governance Code in the Listing Rules[100][104] - All committees, except for the Executive Committee, are chaired by independent non-executive directors[100][104] Audit Committee and Review of Interim Financial Statements The Audit Committee has reviewed the unaudited condensed consolidated financial statements for the six months ended June 30, 2025, deeming them compliant with applicable accounting standards, legal requirements, and the Listing Rules. The company's auditor, RSM Hong Kong, also conducted a review in accordance with Hong Kong Standard on Review Engagements 2410 - The Audit Committee has reviewed the interim financial statements, deeming them compliant with applicable accounting standards, legal requirements, and the Listing Rules[101][105] - The company's auditor, RSM Hong Kong, has reviewed the interim financial statements in accordance with Hong Kong Standard on Review Engagements 2410[102][105] Remuneration Committee The Remuneration Committee's responsibilities include determining executive directors' remuneration policy and structure, assessing their performance, approving service contract terms, recommending remuneration for directors and senior management to the Board, and reviewing and approving share scheme-related matters - The Remuneration Committee is responsible for determining the remuneration policy and structure for executive directors, assessing their performance, and approving service contract terms[103][106] - The Committee also recommends remuneration for directors and senior management to the Board, and reviews and approves matters related to share schemes[103][106] Nomination Committee The Nomination Committee is responsible for determining director nomination policy, annually reviewing the Board's structure, size, composition, and diversity, and recommending director candidates to the Board in accordance with the Board Diversity Policy, while also assessing the independence of independent non-executive directors - The Nomination Committee is responsible for determining the director nomination policy and annually reviewing the Board's structure, size, composition, and diversity[107][112] - The Committee recommends director candidates based on the Board Diversity Policy and assesses the independence of independent non-executive directors[107][112] Executive Committee The Executive Committee is primarily responsible for formulating business policies, making decisions on key business issues and policies, assisting in approving corporate actions, and exercising powers delegated by the Board. The Committee also reviews financial, marketing, retail, operational, and other business performance, and approves annual budgets and key performance indicators - The Executive Committee's primary responsibilities include formulating business policies, making decisions on important business matters and policies, and assisting in approving corporate actions[108][113] - The Committee reviews financial, marketing, retail, operational, and other business performance, and approves annual budgets and key business indicators[108][113] Compliance with CG Code and Model Code For the six months ended June 30, 2025, the Board consistently met the Listing Rules' requirements for the number of independent non-executive directors, and the company fully complied with all provisions of the Corporate Governance Code. All directors confirmed adherence to the Model Code for Securities Transactions by Directors of Listed Issuers, with no non-compliance by relevant employees with company guidelines - The Board has consistently complied with the Listing Rules' requirement to appoint at least three independent non-executive directors, constituting at least one-third of the Board's members[109][113] - The company has fully complied with the code provisions of the Corporate Governance Code throughout the six months ended June 30, 2025[110][114] - All directors confirmed compliance with the Model Code for Securities Transactions by Directors of Listed Issuers[111][115] - The company has adopted written guidelines no less stringent than the Model Code, with no instances of non-compliance found among relevant employees[116][120] Disclosure of Directors and CEO Information under Listing Rule 13.51B(1) Since the last annual report, Non-Executive Director Ms. Lin Shu-Hua was re-appointed as an independent director of Cashbox Partyworld Co., Ltd. Independent Non-Executive Director Mr. Yang Shih-Chien ceased to be an independent director of Topkey Corporation. Independent Non-Executive Director Mr. Chen Ruey-Long ceased to be a director of Tatung Company and Vice Chairman of the Cross-Strait Entrepreneurs Summit. The company secretary and authorized representative changed from Ms. Kuo Yen-Ting to Ms. Li Mei-Yi - Non-Executive Director Ms. Lin Shu-Hua was re-appointed as an independent director of Cashbox Partyworld Co., Ltd. on June 18, 2025[117][121] - Independent Non-Executive Director Mr. Yang Shih-Chien ceased to be an independent director of Topkey Corporation effective May 28, 2025[118][121] - Independent Non-Executive Director Mr. Chen Ruey-Long ceased to be a director of Tatung Company effective May 28, 2025, and ceased to be Vice Chairman of the Cross-Strait Entrepreneurs Summit effective July 17, 2025[119][123] - Ms. Kuo Yen-Ting resigned as company secretary and authorized representative, with Ms. Li Mei-Yi appointed as her successor on August 5, 2025[119][122] Other Information This section covers details regarding the company's listed securities transactions, interim dividends, directors' and chief executives' share interests, share award schemes, and information on substantial shareholders Purchase, Sale or Redemption of Listed Securities For the six months ended June 30, 2025, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities - For the six months ended June 30, 2025, neither the company nor its subsidiaries purchased, sold, or redeemed any listed securities[125][128] Interim Dividend For the six months ended June 30, 2025, no interim dividend was declared by the company - No interim dividend was declared for the six months ended June 30, 2025[126][129] Directors' and Chief Executives' Interests in Shares As of June 30, 2025, to the best of the directors' knowledge, no director or chief executive, or their close associates, held any interests or short positions in the shares, underlying shares, or debentures of the company or its associated corporations that are required to be disclosed under the Securities and Futures Ordinance - As of June 30, 2025, no director or chief executive, or their close associates, held any disclosable interests or short positions in the company's shares or debentures[127][130] Share Awards The company adopted two share award schemes (Scheme I and Scheme II) on May 25, 2022, aimed at recognizing contributions, incentivizing, and retaining key management, and attracting talent. As of June 30, 2025, the maximum number of shares available for grant under the schemes was 60,006,027, but no share awards were granted during the period - The company adopted two share award schemes (Scheme I and Scheme II) on May 25, 2022[132][134] - Scheme I aims to recognize contributions from connected persons and incentivize senior management; Scheme II aims to recognize contributions from non-connected persons, retain, and attract talent[132][133][134][135] - As of June 30, 2025, the maximum number of shares available for grant was 60,006,027 shares, but no share awards were granted during the period[136][139] Directors' Rights to Acquire Shares or Debentures During the review period, neither the company nor any of its subsidiaries participated in any arrangements enabling directors to benefit from acquiring shares or debentures of the company or any other body corporate, and no director, their spouse, or minor children were granted or exercised any rights to subscribe for equity or debt securities of the company - During the review period, neither the company nor its subsidiaries participated in any arrangements enabling directors to benefit from acquiring shares or debentures[138][140] - No director, their spouse, or minor children were granted or exercised any rights to subscribe for the company's equity or debt securities[138][140] Substantial Shareholders As of June 30, 2025, the company's substantial shareholders include Eastern Media International Corporation (holding 30.00% through its wholly-owned subsidiary Far Eastern Warehousing & Shipping (Panama) Co., Ltd.), Mr. Chao Shih-Heng (holding 22.76% through controlled corporations), Dr. Tsai Yen-Yu (holding 22.24% directly and through controlled corporations), and her spouse Mr. Lee Ming-Ta (deemed to have the same interest) Substantial Shareholders' Shareholdings as of June 30, 2025 | Name of Substantial Shareholder | Nature of Interest | Number of Ordinary Shares Beneficially Held | Approximate % of Issued Share Capital | | :--- | :--- | :--- | :--- | | Eastern Media International Corporation | Interest in controlled corporation | 600,630,280(L) | 30.00% | | Far Eastern Warehousing & Shipping (Panama) Co., Ltd. | Beneficial owner | 600,630,280(L) | 30.00% | | Chao Shih-Heng | Interest in controlled corporation | 455,630,196(L) | 22.76% | | Good Titanic Limited | Interest in controlled corporation | 455,630,196(L) | 22.76% | | Insbro Holdings Limited | Beneficial owner | 455,630,196(L) | 22.76% | | Tsai Yen-Yu | Interest in controlled corporation | 445,315,083(L) | 22.24% | | Lee Ming-Ta | Spouse's interest | 445,315,083(L) | 22.24% | | Next Focus Holdings Limited | Beneficial owner / Interest in controlled corporation | 445,315,083(L) | 22.24% | | Starsign International Limited | Interest in controlled corporation | 292,958,524(L) | 14.63% | | Standard Cosmos Limited | Beneficial owner / Interest in controlled corporation | 292,958,524(L) | 14.63% | Independent Review Report This section presents the independent review report by RSM Hong Kong on the company's interim financial information, outlining the scope of their review and their conclusion regarding its preparation in accordance with HKAS 34 Introduction RSM Hong Kong has reviewed Natural Beauty Bio-Technology Limited's interim financial information for the six months ended June 30, 2025, including the condensed consolidated financial statements and notes. Directors are responsible for preparing and presenting this information in accordance with HKAS 34, while the auditor's responsibility is to express a conclusion based on the review - RSM Hong Kong has reviewed the company's interim financial information for the six months ended June 30, 2025[149][150] - Directors are responsible for preparing and presenting the interim financial information in accordance with Hong Kong Accounting Standard 34[149][150] Scope of Review The review was conducted in accordance with Hong Kong Standard on Review Engagements 2410 issued by the Hong Kong Institute of Certified Public Accountants, primarily involving inquiries with personnel responsible for financial and accounting matters, and performing analytical and other review procedures. The scope of a review is less than an audit, thus no audit opinion is expressed - The review was conducted in accordance with Hong Kong Standard on Review Engagements 2410, primarily involving inquiries and analytical procedures[151][153] - The scope of a review is less than an audit, therefore no audit opinion is expressed[151][153] Conclusion Based on the review results, RSM Hong Kong found no matters that lead them to believe the interim financial information was not prepared in all material respects in accordance with Hong Kong Accounting Standard 34 - The auditor found no matters that lead them to believe the interim financial information was not prepared in all material respects in accordance with Hong Kong Accounting Standard 34[152][154] Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income This statement presents the Group's financial performance for the period, including revenue, gross profit, operating profit, profit before tax, and total comprehensive income, highlighting the shift from loss to profit Profit or Loss Performance For the six months ended June 30, 2025, the company's revenue increased year-on-year to HK$264.5 million, with gross profit reaching HK$147.2 million. Operating profit was HK$16.16 million, profit before tax was HK$12.46 million, and profit for the period was HK$10.93 million, achieving a turnaround from loss to profit 2025 H1 Key Profit or Loss Statement Data | Metric | 2025 H1 (HK$ thousand) | 2024 H1 (HK$ thousand) | | :--- | :--- | :--- | | Revenue | 264,504 | 156,749 | | Cost of Sales | (117,335) | (63,419) | | Gross Profit | 147,169 | 93,330 | | Other Income and Gains | 2,020 | 3,810 | | Distribution and Selling Expenses | (92,815) | (82,045) | | Administrative Expenses | (33,890) | (38,855) | | Other Expenses and Losses | (6,414) | (979) | | Operating Profit/(Loss) | 16,156 | (24,579) | | Profit/(Loss) Before Tax | 12,456 | (28,673) | | Income Tax Expense | (1,526) | (1,781) | | Profit/(Loss) for the Period | 10,930 | (30,454) | Other Comprehensive Income and Total Comprehensive Income In 2025 H1, other comprehensive income from exchange differences on translating foreign operations amounted to HK$26.15 million. Total comprehensive income for the period was HK$37.08 million, entirely attributable to owners of the company, marking a turnaround from loss to profit 2025 H1 Other Comprehensive Income and Total Comprehensive Income | Metric | 2025 H1 (HK$ thousand) | 2024 H1 (HK$ thousand) | | :--- | :--- | :--- | | Exchange differences on translating foreign operations | 26,150 | (17,686) | | Total Comprehensive Income for the Period | 37,080 | (48,140) | | Attributable to Owners of the Company | 37,080 | (48,140) | Earnings per Share In 2025 H1, basic earnings per share were 0.55 HK cents, compared to a basic loss per share of 1.52 HK cents in the prior period. Diluted earnings per share are not presented as the company has no potential ordinary shares Earnings/(Loss) per Share | Metric | 2025 H1 (HK cents) | 2024 H1 (HK cents) | | :--- | :--- | :--- | | Basic Earnings/(Loss) per Share | 0.55 | (1.52) | | Diluted Earnings/(Loss) per Share | Not Applicable | Not Applicable | Condensed Consolidated Statement of Financial Position This statement provides a snapshot of the Group's financial position, detailing its non-current and current assets, liabilities, and equity as of the reporting date Assets Overview As of June 30, 2025, the company's total non-current assets were HK$525.9 million, primarily comprising property, plant and equipment, investment properties, and right-of-use assets. Total current assets were HK$325.9 million, mainly consisting of inventories, trade and other receivables, and bank and cash balances Asset Composition as of June 30, 2025 | Asset Category | June 30, 2025 (HK$ thousand) | Dec 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Non-Current Assets | | | | Property, Plant and Equipment | 268,422 | 239,614 | | Investment Properties | 196,719 | 190,021 | | Right-of-Use Assets | 36,278 | 34,871 | | Investment in an Associate | 1,569 | – | | Deferred Tax Assets | 21,134 | 18,123 | | Total Non-Current Assets | 525,872 | 484,172 | | Current Assets | | | | Inventories | 92,487 | 81,204 | | Trade and Other Receivables | 135,895 | 89,614 | | Bank and Cash Balances | 97,163 | 116,507 | | Total Current Assets | 325,854 | 288,759 | Liabilities and Equity Overview As of June 30, 2025, the company's total current liabilities were HK$224.2 million, primarily comprising trade and other payables, borrowings, and lease liabilities. Total non-current liabilities were HK$142.9 million. Net assets amounted to HK$484.7 million, total equity was HK$484.7 million, and share capital was HK$200.2 million Liabilities and Equity Composition as of June 30, 2025 | Liability and Equity Category | June 30, 2025 (HK$ thousand) | Dec 31, 2024 (HK$ thousand) | | :--- | :--- | :--- | | Current Liabilities | | | | Trade and Other Payables | 125,165 | 93,452 | | Borrowings | 72,475 | 68,209 | | Lease Liabilities | 6,899 | 6,090 | | Total Current Liabilities | 224,161 | 187,508 | | Non-Current Liabilities | | | | Borrowings | 128,420 | 124,043 | | Lease Liabilities | 14,472 | 13,787 | | Total Non-Current Liabilities | 142,892 | 137,830 | | Net Assets | 484,673 | 447,593 | | Total Equity | 484,673 | 447,593 | | Share Capital | 200,210 | 200,210 | | Reserves | 284,463 | 247,383 | Condensed Consolidated Statement of Changes in Equity This statement details the changes in the Group's equity attributable to owners of the company for the period, reflecting the impact of total comprehensive income and other equity movements Equity Changes for the Period For the six months ended June 30, 2025, total comprehensive income attributable to owners of the company was HK$37.08 million, primarily driven by an increase of HK$26.15 million in exchange reserves and HK$10.93 million in retained profits, increasing total equity from HK$447.6 million at the beginning of the year to HK$484.7 million 2025 H1 Changes in Equity | Equity Item | Jan 1, 2025 (HK$ thousand) | Total Comprehensive Income for the Period (HK$ thousand) | June 30, 2025 (HK$ thousand) | | :--- | :--- | :--- | :--- | | Share Capital | 200,210 | – | 200,210 | | Capital Surplus | 42,554 | – | 42,554 | | Share Premium | 29,004 | – | 29,004 | | Statutory Reserve | 180,448 | – | 180,448 | | Exchange Reserve | 27,136 | 26,150 | 53,286 | | Property Revaluation Reserve | 29,157 | – | 29,157 | | Remeasurement of Defined Benefit Retirement Plan | 3,578 | – | 3,578 | | Retained Profits | (64,494) | 10,930 | (53,564) | | Total | 447,593 | 37,080 | 484,673 | - Total comprehensive income for the period was HK$37.08 million, primarily from the increase in exchange reserves and the turnaround in retained profits[163] Condensed Consolidated Statement of Cash Flows This statement summarizes the Group's cash inflows and outflows from operating, investing, and financing activities for the period, indicating the net change in cash and cash equivalents Cash Flow Activities For the six months ended June 30, 2025, net cash used in operating activities was HK$13.95 million, a decrease from the prior period. Net cash used in investing activities was HK$21.10 million, primarily for purchasing property, plant, and equipment. Net cash used in financing activities was HK$4.07 million. Cash and cash equivalents at period-end amounted to HK$93.53 million 2025 H1 Cash Flow Overview | Cash Flow Category | 2025 H1 (HK$ thousand) | 2024 H1 (HK$ thousand) | | :--- | :--- | :--- | | Net Cash Used in Operating Activities | (13,952) | (26,532) | | Net Cash Used in Investing Activities | (21,099) | (16,781) | | Net Cash Used in Financing Activities | (4,070) | (11,585) | | Net Decrease in Cash and Cash Equivalents | (39,121) | (54,898) | | Effect of Exchange Rate Changes | 23,614 | (8,341) | | Cash and Cash Equivalents at Jan 1 | 109,038 | 158,743 | | Cash and Cash Equivalents at June 30 | 93,531 | 95,504 | - Investing activities primarily included the purchase of property, plant and equipment of HK$23.6 million and investment in an associate of HK$1.64 million[165] - Financing activities included raising borrowings of HK$24.81 million and repayment of borrowings of HK$22.82 million[165] Notes to the Condensed Financial Statements This section provides detailed notes to the condensed financial statements, covering the basis of preparation, adoption of new accounting standards, fair value measurements of financial instruments, segment information, revenue breakdown, profit/loss components, income tax, dividends, earnings per share, asset movements, and related party transactions Basis of Preparation The condensed financial statements are prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" and applicable disclosure requirements of the Listing Rules, and should be read in conjunction with the 2024 annual financial statements. Accounting policies and methods of computation are consistent with those used in the 2024 annual financial statements - The condensed financial statements are prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" and the Listing Rules[168][172] - Accounting policies and methods of computation are consistent with those used in the 2024 annual financial statements[169][172] Adoption of New and Revised Hong Kong Financial Reporting Standards The Group first applied the amendments to Hong Kong Accounting Standard 21 "Lack of Exchangeability" from January 1, 2025, but did not change accounting policies or make retrospective adjustments as a result - The Group first applied the amendments to Hong Kong Accounting Standard 21 "Lack of Exchangeability" from January 1, 2025[170][173] - No changes to accounting policies or retrospective adjustments were made due to the adoption of the aforementioned revised standard[170][173] Fair Value Measurements of Financial Instruments As of June 30, 2025, and December 31, 2024, no financial assets or financial liabilities were measured at fair value. The carrying amounts of financial assets and financial liabilities reflected in the condensed consolidated statement of financial position approximate their respective fair values - As of June 30, 2025, and December 31, 2024, no financial assets or financial liabilities were measured at fair value[171][174] - The carrying amounts of financial assets and financial liabilities approximate their respective fair values[171][174] Segment Information In 2025 H1, the Group's total revenue from external customers was HK$264.5 million, with the PRC contributing HK$216.9 million and Taiwan HK$45.94 million. PRC segment profit was HK$15.16 million, and Taiwan segment profit was HK$5.47 million. Segment profit or loss excludes central administrative expenses, directors' remuneration, and interest income. Non-current assets are primarily concentrated in the PRC (HK$448.1 million) and Taiwan (HK$56.68 million) 2025 H1 Revenue and Segment Profit by Geographical Region | Region | Revenue from External Customers (HK$ thousand) | Segment Profit/(Loss) (HK$ thousand) | | :--- | :--- | :--- | | PRC | 216,872 | 15,162 | | Taiwan | 45,943 | 5,474 | | Others | 1,689 | (5,077) | | Total | 264,504 | 15,559 | | Unallocated Corporate Expenses | - | (3,406) | | Unallocated Income | - | 303 | | Consolidated Profit Before Tax | - | 12,456 | Non-Current Assets by Location as of June 30, 2025 | Region | Non-Current Assets (HK$ thousand) | | :--- | :--- | | PRC | 448,055 | | Taiwan | 56,683 | | Others | – | | Consolidated Total | 504,738 | - Segment profit or loss excludes central administrative expenses, directors' remuneration, and interest income[177][179] Revenue In 2025 H1, the Group's total revenue was HK$264.5 million, with product sales accounting for HK$262.6 million and service income for HK$1.88 million. Revenue primarily originated from the PRC (HK$216.9 million) and Taiwan (HK$45.94 million). Most product sales and service income are recognized at a point in time or over time 2025 H1 Revenue by Major Product or Service Category | Product or Service Category | 2025 H1 (HK$ thousand) | 2024 H1 (HK$ thousand) | | :--- | :--- | :--- | | Product Sales | 262,625 | 155,626 | | Service Income | 1,879 | 1,123 | | Total | 264,504 | 156,749 | 2025 H1 Revenue by Major Geographical Market and Timing of Recognition | Region/Timing of Recognition | 2025 H1 (HK$ thousand) | 2024 H1 (HK$ thousand) | | :--- | :--- | :--- | | Major Geographical Markets | | | | PRC | 216,872 | 107,833 | | Taiwan | 45,636 | 45,953 | | Others | 1,996 | 2,963 | | Timing of Revenue Recognition | | | | Products transferred at a point in time | 262,625 | 155,626 | | Products and services transferred over time | 1,879 | 1,123 | - As of June 30, 2025, the transaction price allocated to remaining performance obligations was HK$18.66 million, expected to be recognized as revenue within one year[193] Profit/(Loss) for the Period In 2025 H1, profit for the period was HK$10.93 million. Key expenses included depreciation of property, plant and equipment of HK$14.45 million, depreciation of right-of-use assets of HK$3.85 million, total staff costs of HK$74.93 million, and exchange losses of HK$4.18 million 2025 H1 Major Components of Profit/(Loss) for the Period | Item | 2025 H1 (HK$ thousand) | 2024 H1 (HK$ thousand) | | :--- | :--- | :--- | | Depreciation of Property, Plant and Equipment | 14,445 | 11,078 | | Depreciation of Right-of-Use Assets | 3,847 | 2,308 | | Total Staff Costs | 74,930 | 63,978 | | Loss on Disposal of Property, Plant and Equipment | 1,304 | 35 | | Provision for Obsolete Inventories | 1,245 | 512 | | Net Exchange Loss/(Gain) | 4,178 | (1,106) | | Research and Development Expenses | 3,269 | 2,419 | Income Tax Expense In 2025 H1, income tax expense was HK$1.53 million. PRC corporate income tax is accrued at 25%, and Taiwan corporate income tax at 20%. Hong Kong profits tax and other provisions amounted to HK$0.95 million, withholding tax to HK$1.23 million, and deferred tax was a reversal of HK$2.04 million 2025 H1 Income Tax Expense | Tax Category | 2025 H1 (HK$ thousand) | 2024 H1 (HK$ thousand) | | :--- | :--- | :--- | | PRC Corporate Income Tax | 78 | – | | Taiwan Corporate Income Tax | 1,314 | 793 | | Hong Kong Profits Tax and Others | 947 | 797 | | Withholding Tax | 1,231 | 88 | | Deferred Tax | (2,044) | 103 | | Total | 1,526 | 1,781 | - The PRC corporate income tax rate is 25%, and the Taiwan corporate income tax rate is 20%[197][198] - Under Hong Kong's two-tiered profits tax regime, the first HK$2 million of assessable profits is taxed at 8.25%, and the remainder at 16.5%[200] Dividends For the period ended June 30, 2025, no dividends were paid or proposed by the company - No dividends were paid or proposed for the period ended June 30, 2025[202][204] Earnings/(Loss) per Share In 2025 H1, basic earnings per share were 0.55 HK cents, based on profit attributable to owners of the company of HK$10.93 million and a weighted average of 2,002,100,932 ordinary shares outstanding. Diluted earnings per share are