红旗连锁(002697) - 2025 Q2 - 季度财报

Important Notice, Table of Contents, and Definitions Important Notice The Board of Directors, Supervisory Board, and senior management guarantee the semi-annual report's truthfulness, accuracy, and completeness, assuming legal responsibility - The company's Board of Directors, Supervisory Board, and senior management guarantee the report's truthfulness, accuracy, and completeness, and assume legal responsibility[5] - Company head Cao Shiru, chief accountant Li Huan, and accounting department head Li Huan declare the financial report is true, accurate, and complete[5] - The company plans not to distribute cash dividends, bonus shares, or convert capital reserves into share capital for the semi-annual period[6] Table of Contents This chapter lists the overall structure of the semi-annual report, including eight main sections and their corresponding page numbers, providing navigation for investors - The report's table of contents clearly lists eight main sections, including important notice, company profile, management discussion and analysis, corporate governance, significant matters, share changes, bond information, and financial report[8] List of Reference Documents This chapter provides a list of reference documents, including board and supervisory board resolutions, signed financial statements, and publicly disclosed company filings during the reporting period - Reference documents include resolutions from the 23rd meeting of the Fifth Board of Directors, the 15th meeting of the Fifth Supervisory Board, signed and sealed financial statements, and original announcements of all company documents publicly disclosed during the reporting period[10] Definitions This chapter defines specific terms used in the report, including company names, major subsidiaries, relevant laws and regulations, financial units, and reporting period, to ensure accurate understanding - "Company", "the Company", and "Hongqi Chain" all refer to Chengdu Hongqi Chain Co., Ltd[11] - The reporting period refers to January 1, 2025, to June 30, 2025[11] Company Profile and Key Financial Indicators Company Profile Chengdu Hongqi Chain Co., Ltd., stock ticker "Hongqi Chain" and stock code 002697, is listed on the Shenzhen Stock Exchange, with Cao Shiru as its legal representative - The company's stock ticker is "Hongqi Chain", stock code 002697, listed on the Shenzhen Stock Exchange[14] - The company's legal representative is Cao Shiru[14] Contact Person and Contact Information The company's Board Secretary (acting) is Yuan Jiguo, and Securities Affairs Representative is Luo Le, both located at No. 7 Dikang Avenue, West District, High-tech Zone, Chengdu, with provided phone, fax, and email - The Board Secretary (acting) is Yuan Jiguo, and the Securities Affairs Representative is Luo Le[15] - The contact address is No. 7 Dikang Avenue, West District, High-tech Zone, Chengdu, with telephone 028-87825762[15] Other Information During the reporting period, there were no changes to the company's registered address, office address, website, email, or information disclosure and archiving locations, with details available in the 2024 annual report - The company's contact information remained unchanged during the reporting period, details can be found in the 2024 annual report[16] - Information disclosure and archiving locations remained unchanged during the reporting period, details can be found in the 2024 annual report[17] Key Accounting Data and Financial Indicators In the first half of 2025, the company's operating revenue decreased by 7.30% year-on-year to CNY 4.81 billion, but net profit attributable to shareholders of the listed company grew by 5.33% to CNY 280.78 million. Basic earnings per share increased by 5.00% to CNY 0.21/share. Total assets decreased by 2.01% year-on-year, while net assets attributable to shareholders increased by 2.79% 2025 Semi-Annual Key Accounting Data and Financial Indicators | Indicator | Current Period (CNY) | Prior Period (CNY) | Year-on-year change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 4,807,977,434.05 | 5,186,389,931.99 | -7.30% | | Net profit attributable to shareholders of the listed company | 280,784,816.81 | 266,577,931.15 | 5.33% | | Net profit attributable to shareholders of the listed company after deducting non-recurring gains and losses | 262,272,731.73 | 241,428,118.37 | 8.63% | | Net cash flow from operating activities | 413,774,700.54 | 434,859,893.84 | -4.85% | | Basic earnings per share (CNY/share) | 0.21 | 0.20 | 5.00% | | Diluted earnings per share (CNY/share) | 0.21 | 0.20 | 5.00% | | Weighted average return on net assets | 6.13% | 6.32% | -0.19% | | Period-end Indicators | Current Period-end (CNY) | Prior Year-end (CNY) | Period-end vs. Prior Year-end change (%) | | Total Assets | 8,118,960,072.28 | 8,285,158,257.60 | -2.01% | | Net assets attributable to shareholders of the listed company | 4,587,451,317.87 | 4,463,066,501.06 | 2.79% | Differences in Accounting Data Under Domestic and Overseas Accounting Standards During the reporting period, the company had no differences in net profit and net assets between financial reports disclosed under International Accounting Standards or overseas accounting standards and Chinese accounting standards - The company had no differences in net profit and net assets between financial reports disclosed under International Accounting Standards and Chinese accounting standards during the reporting period[20] - The company had no differences in net profit and net assets between financial reports disclosed under overseas accounting standards and Chinese accounting standards during the reporting period[21] Non-recurring Gains and Losses and Amounts During the reporting period, the company's total non-recurring gains and losses amounted to CNY 18.51 million, primarily from government grants, gains/losses on disposal of non-current assets, and other non-operating income and expenses 2025 Semi-Annual Non-recurring Gains and Losses and Amounts | Item | Amount (CNY) | | :--- | :--- | | Gains/losses on disposal of non-current assets | 602,718.25 | | Government grants recognized in current profit/loss | 17,600,953.14 | | Other non-operating income and expenses apart from the above | 3,575,252.24 | | Less: Income tax impact | 3,266,838.55 | | Total | 18,512,085.08 | - The company has no other profit/loss items that meet the definition of non-recurring gains and losses, nor does it classify non-recurring gains and losses as recurring gains and losses[24] Management Discussion and Analysis Main Business Activities During the Reporting Period The company primarily operates convenience store chains, characterized by "convenience, affordability, and trustworthiness," evolving into an internet+modern technology chain company integrating "cloud platform big data + merchandise + community services + finance" - The company's main business is convenience store chain operation, having evolved into an internet+modern technology chain company integrating "cloud platform big data + merchandise + community services + finance"[26] - By optimizing store structure, strengthening internal management, and optimizing resource allocation, the company effectively saved costs and expenses, with a 6.5% year-on-year decrease in the three period expenses, driving a counter-trend increase in net profit[28] 2025 Semi-Annual Operating Performance | Indicator | Amount (CNY 100 million) | Year-on-year change | | :--- | :--- | :--- | | Sales including tax | 53.65 | -7.3% | | Net profit attributable to shareholders of the listed company | 2.81 | +5.33% | | Net cash flow from operating activities | 4.14 | -4.85% | - The company's total assets are CNY 8.12 billion, with an asset-liability ratio of 43.49%, indicating a healthy financial structure and stable operations[29] Core Competitiveness Analysis The company's core competitiveness lies in its differentiated "merchandise + service" strategy, a dense store network centered in Chengdu, talent and brand advantages, and advanced information management technology and efficient logistics system - The company adheres to a differentiated "merchandise + service" competitive strategy, providing safe products and convenient services, optimizing product structure, enriching value-added services, and enhancing customer loyalty[31] - The company has formed a dense store network radiating from Chengdu to surrounding areas, facilitating synergistic effects in marketing, warehousing and logistics, personnel deployment, and brand promotion[32] - The company possesses a strong talent base and highly recognized brand influence, having established mutually beneficial partnerships with thousands of suppliers[32] - The company has established its own information management system, improving efficiency and modern management levels in merchandise distribution, turnover, cashier operations, and accounting[32] - The company has achieved centralized warehousing and distribution for most products, enhancing its procurement bargaining power and product resource advantages[33] Main Business Analysis The company's main business is commercial retail, with operating revenue decreasing by 7.30% year-on-year in the first half of 2025, but operating costs, selling expenses, administrative expenses, and financial expenses all decreased to varying degrees Year-on-year Changes in Key Financial Data | Indicator | Current Period (CNY) | Prior Period (CNY) | Year-on-year change (%) | Reason for Change | | :--- | :--- | :--- | :--- | :--- | | Operating Revenue | 4,807,977,434.05 | 5,186,389,931.99 | -7.30% | | | Operating Cost | 3,372,676,637.82 | 3,683,321,154.54 | -8.43% | | | Selling Expenses | 1,097,101,668.68 | 1,138,050,492.69 | -3.60% | | | Administrative Expenses | 58,448,746.32 | 74,680,126.72 | -21.73% | | | Financial Expenses | 19,694,005.45 | 45,388,249.05 | -56.61% | | | Net cash flow from investing activities | -6,430,041.51 | 164,766,797.11 | -103.90% | Due to purchase of bank wealth management products in the prior period | - The company's profit structure or sources of profit did not undergo significant changes during the reporting period[36] Operating Revenue Composition (by Product and Region) | Category | Item | Current Period Amount (CNY) | Proportion of Operating Revenue (%) | Prior Period Amount (CNY) | Proportion of Operating Revenue (%) | Year-on-year change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | By Product | Tobacco and Alcohol | 1,702,766,181.11 | 35.42% | 1,813,588,104.94 | 34.97% | -6.11% | | | General Merchandise | 592,367,212.87 | 12.32% | 705,013,762.42 | 13.59% | -15.98% | | | Food | 2,133,811,117.81 | 44.38% | 2,274,315,061.07 | 43.85% | -6.18% | | | Other Business Income | 379,032,922.26 | 7.88% | 393,473,003.56 | 7.59% | -3.67% | | By Region | Main Urban Area | 2,431,661,352.27 | 50.58% | 2,649,247,568.58 | 51.07% | -8.21% | | | Suburban Districts | 1,808,811,477.88 | 37.62% | 1,933,848,289.05 | 37.29% | -6.47% | | | Secondary Urban Areas | 188,471,681.64 | 3.92% | 209,821,070.80 | 4.05% | -10.18% | | | Other Business Income | 379,032,922.26 | 7.88% | 393,473,003.56 | 7.59% | -3.67% | Non-Main Business Analysis The company's non-main business profit primarily stems from investment income from XW Bank, which is sustainable and accounts for 22.32% of total profit Non-Main Business Analysis | Item | Amount (CNY) | Proportion of Total Profit (%) | Reason for Formation | Sustainability | | :--- | :--- | :--- | :--- | :--- | | Investment Income | 72,832,273.51 | 22.32% | Primarily income from investment in XW Bank | Yes | Analysis of Assets and Liabilities At the end of the reporting period, the company's total assets were CNY 8.12 billion, a 2.01% decrease from the end of the prior year. Cash and cash equivalents, accounts receivable, fixed assets, and right-of-use assets decreased, while inventories and long-term equity investments increased. On the liability side, contract liabilities and lease liabilities decreased Significant Changes in Asset Composition | Item | Current Period-end Amount (CNY) | Proportion of Total Assets (%) | Prior Year-end Amount (CNY) | Proportion of Total Assets (%) | Change Rate (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Cash and Cash Equivalents | 2,423,508,436.88 | 29.85% | 2,504,770,497.72 | 30.23% | -0.38% | | Accounts Receivable | 96,975,441.08 | 1.19% | 120,499,476.82 | 1.45% | -0.26% | | Inventories | 2,075,491,057.96 | 25.56% | 2,051,897,910.02 | 24.77% | 0.79% | | Long-term Equity Investments | 1,265,839,306.06 | 15.59% | 1,193,007,032.55 | 14.40% | 1.19% | | Fixed Assets | 952,871,355.89 | 11.74% | 987,067,961.48 | 11.91% | -0.17% | | Right-of-use Assets | 954,614,768.25 | 11.76% | 1,044,296,906.75 | 12.60% | -0.84% | | Contract Liabilities | 1,063,825,508.12 | 13.10% | 1,128,939,604.64 | 13.63% | -0.53% | | Lease Liabilities | 346,637,872.30 | 4.27% | 434,665,824.84 | 5.25% | -0.98% | Investment Status Analysis During the reporting period, the company did not undertake significant equity or non-equity investments, nor did it have any securities investments, derivative investments, or use of raised funds - The company had no securities investments, derivative investments, or use of raised funds during the reporting period[42][43][44] Disposal of Significant Assets and Equity During the reporting period, the company did not dispose of any significant assets or equity - The company did not dispose of any significant assets or equity during the reporting period[45][46] Analysis of Major Holding and Associate Companies The company had no important holding or associate company information to disclose during the reporting period - The company had no important holding or associate company information to disclose during the reporting period[46] Information on Structured Entities Controlled by the Company The company had no structured entities under its control during the reporting period - The company had no structured entities under its control during the reporting period[47] Risks Faced by the Company and Countermeasures The company faces risks from macroeconomic trends affecting consumer demand, intense retail market competition, and continuously rising operating costs, which it addresses through differentiated strategies and big data utilization - A slowdown in macroeconomic trends may impact consumer confidence, suppressing social consumption demand and adversely affecting retail industry development[47] - The retail market faces intense competition, and the company employs a differentiated competitive strategy, focusing on convenience store formats, offering "convenient, affordable, and trustworthy" products and value-added services, and adding localized features to meet diverse consumer needs[47] - The company faces risks from continuously rising operating costs, such as commercial property lease costs, personnel wages, and promotional expenses, which it addresses by fully utilizing big data to enhance management efficiency and improve per capita and per square meter productivity[47][48] Formulation and Implementation of Market Value Management System and Valuation Enhancement Plan The company has not formulated a market value management system nor disclosed a valuation enhancement plan - The company has not formulated a market value management system nor disclosed a valuation enhancement plan[49] Implementation of "Dual Improvement in Quality and Returns" Action Plan The company has not disclosed an announcement regarding the "Dual Improvement in Quality and Returns" action plan - The company has not disclosed an announcement regarding the "Dual Improvement in Quality and Returns" action plan[49] Corporate Governance, Environment, and Society Changes in Directors, Supervisors, and Senior Management During the reporting period, four Deputy General Managers, including Zhang Ying, Wan Chun, Yang Yuanbin, and Hong Fan, were dismissed due to work reassignment, with the changes effective March 3, 2025 Changes in Senior Management | Name | Position Held | Type | Date | Reason | | :--- | :--- | :--- | :--- | :--- | | Zhang Ying | Deputy General Manager | Dismissal | March 03, 2025 | Work reassignment | | Wan Chun | Deputy General Manager | Dismissal | March 03, 2025 | Work reassignment | | Yang Yuanbin | Deputy General Manager | Dismissal | March 03, 2025 | Work reassignment | | Hong Fan | Deputy General Manager | Dismissal | March 03, 2025 | Work reassignment | Profit Distribution and Capital Reserve Conversion to Share Capital for the Current Reporting Period The company plans not to distribute cash dividends, bonus shares, or convert capital reserves into share capital for the semi-annual period - The company plans not to distribute cash dividends, bonus shares, or convert capital reserves into share capital for the semi-annual period[51] Implementation of Equity Incentive Plans, Employee Stock Ownership Plans, or Other Employee Incentive Measures During the reporting period, the company had no equity incentive plans, employee stock ownership plans, or other employee incentive measures and their implementation - The company had no equity incentive plans, employee stock ownership plans, or other employee incentive measures and their implementation during the reporting period[52] Environmental Information Disclosure The listed company and its major subsidiaries are not included in the list of enterprises required to disclose environmental information by law - The listed company and its major subsidiaries are not included in the list of enterprises required to disclose environmental information by law[53] Social Responsibility Hongqi Chain actively fulfills its corporate social responsibility, long-term commitment to public welfare and charity, with cumulative donations exceeding CNY 100 million. In the first half of 2025, the company paid CNY 450 million in taxes and social security, actively participated in disaster relief, and supported rural revitalization - The company is long-term committed to public welfare and charity, donating over CNY 100 million to society; General Manager Ms. Cao Shiru personally donated over CNY 70 million[53] - From January to June 2025, the company paid CNY 450 million in taxes and social security to the state, and received multiple industry and brand honors[54] - The company actively participated in disaster relief efforts for the Tibet Rikaze earthquake and Sichuan Yibin landslide, donating relief supplies and daily necessities[55] - The company assists in selling agricultural products and supports rural revitalization and farmer income growth through farm-to-supermarket strategic cooperation, direct sourcing from production areas, and opening rural selection stores[56] Significant Matters Fulfillment of Commitments During the reporting period, the company had no commitments that were fulfilled or overdue and unfulfilled by the actual controller, shareholders, related parties, acquirers, or the company - The company had no commitments that were fulfilled or overdue and unfulfilled by related parties during the reporting period[58] Non-operating Funds Occupied by Controlling Shareholders and Other Related Parties During the reporting period, there were no non-operating funds occupied by controlling shareholders and other related parties of the listed company - The company had no non-operating funds occupied by controlling shareholders and other related parties of the listed company during the reporting period[59] Irregular External Guarantees During the reporting period, the company had no irregular external guarantees - The company had no irregular external guarantees during the reporting period[60] Appointment and Dismissal of Accounting Firms The company's semi-annual financial report was not audited - The company's semi-annual report was not audited[61] Explanation by the Board of Directors and Supervisory Board on the Accounting Firm's "Non-standard Audit Report" for the Current Period The company had no non-standard audit report during the reporting period, thus the Board of Directors and Supervisory Board do not need to provide an explanation - The company had no non-standard audit report during the reporting period[62] Explanation by the Board of Directors on the "Non-standard Audit Report" for the Prior Year The company had no non-standard audit report for the prior year during the reporting period, thus the Board of Directors does not need to provide an explanation - The company had no non-standard audit report for the prior year during the reporting period[62] Bankruptcy Reorganization Matters During the reporting period, the company did not experience any bankruptcy reorganization matters - The company did not experience any bankruptcy reorganization matters during the reporting period[62] Litigation Matters During the reporting period, the company had no significant litigation, arbitration, or other litigation matters - The company had no significant litigation, arbitration, or other litigation matters during this reporting period[63] Penalties and Rectification During the reporting period, the company had no penalties or rectification situations - The company had no penalties or rectification situations during the reporting period[64] Integrity Status of the Company, its Controlling Shareholder, and Actual Controller During the reporting period, there were no integrity issues concerning the company, its controlling shareholder, or actual controller - During the reporting period, there were no integrity issues concerning the company, its controlling shareholder, or actual controller[65] Significant Related Party Transactions During the reporting period, the company engaged in daily related party transactions with other enterprises controlled by its controlling shareholder, primarily involving the purchase of goods and acceptance of platform services, with transaction prices based on market rates Related Party Transactions Related to Daily Operations (Purchase of Goods/Acceptance of Services) | Related Party | Related Party Transaction Type | Related Party Transaction Content | Related Party Transaction Amount (CNY 10,000) | Approved Transaction Limit (CNY 10,000) | | :--- | :--- | :--- | :--- | :--- | | Sichuan Shangtou Qihe Enterprise Management Co., Ltd. | Purchase | Purchase of Goods | 111.46 | 288 | | Sichuan Provincial Vegetable Catering Service Co., Ltd. | Purchase | Purchase of Goods | 122.99 | 235 | | Sichuan Provincial Traditional Chinese Medicine Group Co., Ltd. | Purchase | Purchase of Goods | 2 | 60 | | Sichuan Tianfu Haoliangyou Co., Ltd. | Purchase | Purchase of Goods | 2,378.29 | 6,000 | | Sichuan Hexin Zhizhi Technology Co., Ltd. | Entrusted Related Party Sales | Sale of Goods | 1,069.31 | 1,760 | | Sichuan Shangtong Payment Technology Co., Ltd. | Acceptance of Services from Related Party | Platform Service Fees | 227.97 | 370 | | Total | -- | -- | 3,912.02 | 8,713 | - The company's Board of Directors convened on April 18, 2025, and approved the "Proposal on the Company's Daily Related Party Transactions for the Next Three Years," agreeing that the company and its subsidiaries would lease properties from related parties[73] - The company's Board of Directors approved the "Proposal on Daily Related Party Transactions with Related Banks" on July 25, 2024, agreeing to deposit funds with XW Bank within one year of the board's approval[73] Significant Contracts and Their Performance The company's stores primarily operate on leased properties, and during the reporting period, there were no lease projects that generated profits exceeding 10% of total profit. The company had no custody, contracting, significant guarantees, wealth management, or other significant contracts during the reporting period - The company's stores primarily operate on leased properties, and during the reporting period, there were no lease projects that generated profits exceeding 10% of total profit[77] - The company had no custody, contracting, significant guarantees, wealth management, or other significant contracts during the reporting period[75][76][78][79][80] Explanation of Other Significant Matters During the reporting period, the company had no other significant matters requiring explanation - The company had no other significant matters requiring explanation during the reporting period[81] Significant Matters of Subsidiaries During the reporting period, the company had no significant matters concerning its subsidiaries - The company had no significant matters concerning its subsidiaries during the reporting period[82] Share Changes and Shareholder Information Share Fluctuation During the reporting period, the company's restricted shares decreased by 70,462,950 shares, and unrestricted shares increased by 70,462,950 shares, primarily due to the unlocking of restricted shares for senior executives. At period-end, restricted shares accounted for 15.82% of total share capital, and unrestricted shares accounted for 84.18% Share Fluctuation | Share Type | Quantity Before Change (shares) | Proportion Before Change (%) | Increase/Decrease in Current Change (shares) | Quantity After Change (shares) | Proportion After Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | I. Restricted Shares | 285,560,450 | 21.00% | -70,462,950 | 215,097,500 | 15.82% | | II. Unrestricted Shares | 1,074,439,550 | 79.00% | 70,462,950 | 1,144,902,500 | 84.18% | | III. Total Shares | 1,360,000,000 | 100.00% | 0 | 1,360,000,000 | 100.00% | - The main reason for share fluctuation was the unlocking of restricted shares for senior executives[86] Changes in Restricted Shares | Shareholder Name | Restricted Shares at Period-beginning (shares) | Unrestricted Shares Released in Current Period (shares) | Restricted Shares Increased in Current Period (shares) | Restricted Shares at Period-end (shares) | Reason for Restriction | | :--- | :--- | :--- | :--- | :--- | :--- | | Zhang Ying | 262,500 | 0 | 87,500 | 350,000 | Lock-up due to resignation | | Yi Wei | 10,000 | 2,500 | 0 | 7,500 | Lock-up for directors, supervisors, and senior executives | | Yang Yuanbin | 322,200 | 0 | 107,400 | 429,600 | Lock-up due to resignation | | Wen Chunlin | 346,200 | 86,550 | 0 | 259,650 | Lock-up for senior executives | | Wang Ning | 352,900 | 88,225 | 0 | 264,675 | Lock-up for senior executives | | Wan Chun | 413,700 | 0 | 137,900 | 551,600 | Lock-up due to resignation | | Niu Hao | 330,000 | 82,500 | 0 | 247,500 | Lock-up for senior executives | | Hong Fan | 315,075 | 0 | 105,025 | 420,100 | Lock-up due to resignation | | Chen Huijun | 318,100 | 79,525 | 0 | 238,575 | Lock-up for senior executives | | Xiong Jian | 470,900 | 117,725 | 0 | 353,175 | Lock-up for senior executives | | Total | 3,141,575 | 457,025 | 437,825 | 3,122,375 | -- | Issuance and Listing of Securities During the reporting period, the company had no issuance or listing of securities - The company had no issuance or listing of securities during the reporting period[88] Shareholder Numbers and Shareholding At the end of the reporting period, the total number of common shareholders was 63,834. Among the top ten shareholders, Cao Shiru held 18.06%, Sichuan Shangtou Investment Co., Ltd. held 16.91%, and Yonghui Superstores Co., Ltd. held 9.99%. Cao Shiru and Cao Zengjun are mother and son, and Cao Shiru and Cao Zengjun signed a voting rights waiver agreement with Shangtou Investment - At the end of the reporting period, the total number of common shareholders was 63,834[89] Shareholding of Shareholders Holding 5% or More or Top 10 Shareholders | Shareholder Name | Shareholder Nature | Shareholding Proportion (%) | Shareholding at Period-end (shares) | Restricted Shares Held (shares) | Unrestricted Shares Held (shares) | | :--- | :--- | :--- | :--- | :--- | :--- | | Cao Shiru | Domestic Natural Person | 18.06% | 245,565,000 | 184,173,750 | 61,391,250 | | Sichuan Shangtou Investment Co., Ltd. | State-owned Legal Person | 16.91% | 229,925,000 | 0 | 229,925,000 | | Yonghui Superstores Co., Ltd. | Domestic Non-state-owned Legal Person | 9.99% | 135,829,500 | 0 | 135,829,500 | | Hong Kong Securities Clearing Company Limited | Overseas Legal Person | 4.06% | 55,205,903 | 0 | 55,205,903 | | Cao Zengjun | Domestic Natural Person | 2.66% | 36,210,000 | 27,157,500 | 9,052,500 | | Zhongmin Caizhi Co., Ltd. | Domestic Non-state-owned Legal Person | 2.35% | 31,963,510 | 0 | 31,963,510 | - Shareholder Ms. Cao Shiru and Mr. Cao Zengjun are mother and son. Cao Shiru, Cao Zengjun, and Shangtou Investment signed a "Voting Rights Waiver Agreement," waiving the voting rights corresponding to their remaining untransferred 281,775,000 shares of the listed company[89] Changes in Shareholdings of Directors, Supervisors, and Senior Management The shareholdings of the company's directors, supervisors, and senior management did not change during the reporting period, with details available in the 2024 annual report - The shareholdings of the company's directors, supervisors, and senior management did not change during the reporting period[91] Changes in Controlling Shareholder or Actual Controller During the reporting period, there were no changes in the company's controlling shareholder or actual controller - The company's controlling shareholder did not change during the reporting period[93] - The company's actual controller did not change during the reporting period[93] Preferred Share Information During the reporting period, the company had no preferred shares - The company had no preferred shares during the reporting period[94] Bond-Related Information Bond-Related Information During the reporting period, the company had no bond-related information - The company had no bond-related information during the reporting period[96] Financial Report Audit Report The company's semi-annual financial report was not audited - The company's semi-annual financial report was not audited[98] Financial Statements This chapter provides the company's consolidated and parent company balance sheets, income statements, cash flow statements, and statements of changes in equity for the first half of 2025, comprehensively presenting the company's financial position, operating results, and cash flow Consolidated Balance Sheet As of June 30, 2025, the company's consolidated total assets were CNY 8.12 billion, total liabilities were CNY 3.53 billion, and total owners' equity was CNY 4.59 billion. Cash and cash equivalents and inventories accounted for a higher proportion of current assets, while long-term equity investments, fixed assets, and right-of-use assets were the main components of non-current assets Consolidated Balance Sheet Key Data (June 30, 2025) | Item | Period-end Balance (CNY) | Period-beginning Balance (CNY) | | :--- | :--- | :--- | | Cash and Cash Equivalents | 2,423,508,436.88 | 2,504,770,497.72 | | Inventories | 2,075,491,057.96 | 2,051,897,910.02 | | Long-term Equity Investments | 1,265,839,306.06 | 1,193,007,032.55 | | Fixed Assets | 952,871,355.89 | 987,067,961.48 | | Right-of-use Assets | 954,614,768.25 | 1,044,296,906.75 | | Accounts Payable | 1,340,671,411.30 | 1,470,786,245.29 | | Contract Liabilities | 1,063,825,508.12 | 1,128,939,604.64 | | Lease Liabilities | 346,637,872.30 | 434,665,824.84 | | Total Assets | 8,118,960,072.28 | 8,285,158,257.60 | | Total Liabilities | 3,530,874,621.71 | 3,821,464,549.79 | | Total Owners' Equity | 4,588,085,450.57 | 4,463,693,707.81 | Parent Company Balance Sheet As of June 30, 2025, the parent company's total assets were CNY 8.79 billion, total liabilities were CNY 4.09 billion, and total owners' equity was CNY 4.69 billion. Other receivables accounted for a higher proportion of current assets, while long-term equity investments and fixed assets were the main non-current assets Parent Company Balance Sheet Key Data (June 30, 2025) | Item | Period-end Balance (CNY) | Period-beginning Balance (CNY) | | :--- | :--- | :--- | | Cash and Cash Equivalents | 2,274,269,970.57 | 2,376,693,248.08 | | Other Receivables | 2,857,147,621.74 | 2,579,897,717.50 | | Inventories | 614,655,687.18 | 658,754,102.39 | | Long-term Equity Investments | 1,857,022,824.91 | 1,784,190,551.40 | | Fixed Assets | 828,269,955.90 | 850,065,276.37 | | Accounts Payable | 663,607,362.36 | 629,436,946.07 | | Contract Liabilities | 826,955,419.21 | 702,532,597.71 | | Other Payables | 2,271,550,476.55 | 2,361,462,508.47 | | Total Assets | 8,785,242,489.69 | 8,645,874,342.44 | | Total Liabilities | 4,090,829,749.00 | 4,045,166,091.92 | | Total Owners' Equity | 4,694,412,740.69 | 4,600,708,250.52 | Consolidated Income Statement In the first half of 2025, the company's consolidated total operating revenue was CNY 4.81 billion, a 7.30% year-on-year decrease. Net profit was CNY 280.79 million, a 5.33% year-on-year increase. Operating profit and total profit both increased, mainly due to effective control of total operating costs, especially a significant decrease in financial expenses Consolidated Income Statement Key Data (2025 Semi-Annual) | Item | Current Period Amount (CNY) | Prior Period Amount (CNY) | | :--- | :--- | :--- | | Total Operating Revenue | 4,807,977,434.05 | 5,186,389,931.99 | | Total Operating Cost | 4,576,311,158.09 | 4,968,564,173.49 | | Operating Profit | 322,828,054.76 | 306,297,212.05 | | Total Profit | 326,282,473.10 | 306,768,355.09 | | Net Profit | 280,791,742.76 | 266,557,899.05 | | Net profit attributable to parent company shareholders | 280,784,816.81 | 266,577,931.15 | | Basic earnings per share (CNY/share) | 0.21 | 0.20 | - Financial expenses for the current period were CNY 19.69 million, a significant decrease of 56.61% from CNY 45.39 million in the prior period[109] Parent Company Income Statement In the first half of 2025, the parent company's operating revenue was CNY 1.55 billion, largely flat year-on-year. Net profit was CNY 250.10 million, an 11.39% year-on-year decrease. Operating profit and total profit both declined, but financial expenses turned negative, indicating increased interest income or reduced interest expenses Parent Company Income Statement Key Data (2025 Semi-Annual) | Item | 2025 Semi-Annual (CNY) | 2024 Semi-Annual (CNY) | | :--- | :--- | :--- | | Operating Revenue | 1,549,127,460.43 | 1,550,160,467.21 | | Operating Cost | 1,104,237,516.55 | 1,091,698,910.72 | | Selling Expenses | 348,130,601.01 | 364,182,026.58 | | Administrative Expenses | 56,040,101.05 | 72,116,747.12 | | Financial Expenses | -3,656,320.87 | 4,126,875.91 | | Operating Profit | 253,803,786.65 | 286,538,714.94 | | Total Profit | 257,564,293.10 | 286,807,390.99 | | Net Profit | 250,104,490.17 | 282,240,827.15 | - The parent company's financial expenses turned from CNY 4.13 million in the prior period to CNY -3.66 million in the current period, mainly due to increased interest income[112] Consolidated Cash Flow Statement In the first half of 2025, the company's net cash flow from operating activities was CNY 413.77 million, a slight year-on-year decrease. Net cash flow from investing activities turned negative, mainly due to cash recovered from investments in the prior period. Net cash outflow from financing activities was largely flat year-on-year. The net increase in cash and cash equivalents was negative, resulting in a decrease in the period-end balance Consolidated Cash Flow Statement Key Data (2025 Semi-Annual) | Item | 2025 Semi-Annual (CNY) | 2024 Semi-Annual (CNY) | | :--- | :--- | :--- | | Net cash flow from operating activities | 413,774,700.54 | 434,859,893.84 | | Net cash flow from investing activities | -6,430,041.51 | 164,766,797.11 | | Net cash flow from financing activities | -487,848,320.87 | -479,965,254.61 | | Net increase in cash and cash equivalents | -80,503,661.84 | 119,661,436.34 | | Period-end cash and cash equivalents balance | 2,413,977,460.88 | 1,847,333,321.03 | - Net cash flow from investing activities turned from CNY 165 million in the prior period to CNY -6.43 million in the current period, mainly due to CNY 800 million in cash recovered from investments in the prior period[115] Parent Company Cash Flow Statement In the first half of 2025, the parent company's net cash flow from operating activities was CNY 136.23 million, a 62.92% year-on-year increase. Net cash flow from investing activities turned negative, and net cash outflow from financing activities decreased. The period-end cash and cash equivalents balance was CNY 2.26 billion Parent Company Cash Flow Statement Key Data (2025 Semi-Annual) | Item | 2025 Semi-Annual (CNY) | 2024 Semi-Annual (CNY) | | :--- | :--- | :--- | | Net cash flow from operating activities | 136,229,019.97 | 83,616,674.59 | | Net cash flow from investing activities | -5,139,223.94 | 376,140,413.37 | | Net cash flow from financing activities | -232,754,674.54 | -303,389,646.59 | | Net increase in cash and cash equivalents | -101,664,878.51 | 156,367,441.37 | | Period-end cash and cash equivalents balance | 2,264,738,994.57 | 1,770,113,371.99 | - The parent company's net cash flow from operating activities increased by 62.92% year-on-year, indicating an improvement in operating cash flow[117] Consolidated Statement of Changes in Equity In the first half of 2025, the company's consolidated total owners' equity increased from CNY 4.46 billion at the beginning of the period to CNY 4.59 billion at the end, mainly due to an increase in net profit attributable to parent company shareholders, along with the appropriation of surplus reserves and distribution of common stock dividends Consolidated Statement of Changes in Equity (2025 Semi-Annual) | Item | Share Capital (CNY) | Capital Reserve (CNY) | Surplus Reserve (CNY) | Retained Earnings (CNY) | Total Owners' Equity Attributable to Parent Company (CNY) | Minority Interests (CNY) | Total Owners' Equity (CNY) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | I. Balance at Prior Year-end | 1,360,000,000.00 | 43,743,156.96 | 480,249,218.37 | 2,579,074,125.73 | 4,463,066,501.06 | 627,206.75 | 4,463,693,707.81 | | III. Amount of Increase/Decrease in Current Period | 0 | 0 | 25,010,449.02 | 99,374,367.79 | 124,384,816.81 | 6,925.95 | 124,391,742.76 | | IV. Balance at Current Period-end | 1,360,000,000.00 | 43,743,156.96 | 505,259,667.39 | 2,678,448,493.52 | 4,587,451,317.87 | 634,132.70 | 4,588,085,450.57 | - The total comprehensive income attributable to parent company owners for the current period was CNY 280.78 million[121] - In the current period's profit distribution, CNY 25.01 million was appropriated to surplus reserves, and CNY 156.40 million was distributed to owners as common stock dividends[121] Parent Company Statement of Changes in Equity In the first half of 2025, the parent company's total owners' equity increased from CNY 4.60 billion at the beginning of the period to CNY 4.69 billion at the end. Key changes included an increase in net profit, appropriation of surplus reserves, and distribution of dividends to owners Parent Company Statement of Changes in Equity (2025 Semi-Annual) | Item | Share Capital (CNY) | Capital Reserve (CNY) | Surplus Reserve (CNY) | Retained Earnings (CNY) | Total Owners' Equity (CNY) | | :--- | :--- | :--- | :--- | :--- | :--- | | I. Balance at Prior Year-end | 1,360,000,000.00 | 42,896,066.97 | 480,249,218.37 | 2,717,562,965.18 | 4,600,708,250.52 | | III. Amount of Increase/Decrease in Current Period | 0 | 0 | 25,010,449.02 | 68,694,041.15 | 93,704,490.17 | | IV. Balance at Current Period-end | 1,360,000,000.00 | 42,896,066.97 | 505,259,667.39 | 2,786,257,006.33 | 4,694,412,740.69 | - The total comprehensive income of the parent company for the current period was CNY 250.10 million[129] - In the current period's profit distribution, CNY 25.01 million was appropriated to surplus reserves, and CNY 156.40 million was distributed to owners as common stock dividends[129] Company Basic Information Chengdu Hongqi Chain Co., Ltd. was established on June 22, 2000, listed in September 2012, with a registered capital of CNY 1.36 billion. The company primarily engages in wholesale and retail, with Sichuan Shangtou Investment Co., Ltd. as its controlling shareholder and the Sichuan Provincial Government State-owned Assets Supervision and Administration Commission as its actual controller. This chapter also lists the company's major subsidiaries included in the consolidated financial statements - The company was established on June 22, 2000, listed on the Shenzhen Stock Exchange in September 2012, with a registered capital of CNY 1.36 billion[132] - The company's main business is wholesale and retail, with Sichuan Shangtou Investment Co., Ltd. as its controlling shareholder and the Sichuan Provincial Government State-owned Assets Supervision and Administration Commission as its actual controller[132] - The company's consolidated financial statements include 26 subsidiaries, such as Hongqi Wholesale, Wuhou Hongqi, and Chenghua Hongqi[132][133] Basis of Financial Statement Preparation These financial statements are prepared in accordance with the Accounting Standards for Business Enterprises issued by the Ministry of Finance and relevant regulations of the China Securities Regulatory Commission, on a going concern basis, with the company possessing going concern capability within 12 months from the end of the reporting period - These financial statements are prepared in accordance with the Accounting Standards for Business Enterprises issued by the Ministry of Finance and the "Information Disclosure and Reporting Rules for Companies Issuing Securities to the Public No. 15 - General Provisions for Financial Reports" by the China Securities Regulatory Commission[134] - These financial statements are prepared on a going concern basis, and the company possesses going concern capability within 12 months from the end of the reporting period[135] Significant Accounting Policies and Estimates This chapter details the company's declaration of compliance with accounting standards, accounting period, operating cycle, functional currency, materiality criteria, business combinations, consolidated financial statement preparation, cash and cash equivalents, financial instruments, inventories, long-term equity investments, fixed assets, construction in progress, borrowing costs, intangible assets, impairment of long-term assets, long-term deferred expenses, contract liabilities, employee benefits, provisions, revenue, contract costs, government grants, deferred income tax assets/liabilities, and leases, as significant accounting policies and estimates - The company complies with Accounting Standards for Business Enterprises, accurately and completely reflecting its financial position, operating results, and cash flows[136] - The company classifies financial assets as those measured at amortized cost, at fair value through other comprehensive income, and at fair value through profit or loss[150] - The company's inventories are classified as revolving materials, merchandise, etc., valued using the first-in, first-out method, adopting a perpetual inventory system, and measured at the lower of cost and net realizable value for inventory impairment provisions[180][181] - The company recognizes revenue when performance obligations are satisfied, i.e., when the customer obtains control of the related goods or services; retail business is divided into self-operated and concession models, and service revenue is recognized based on the progress of performance[216][217][219][220][221][222][223][224] Taxation The company's main taxes include VAT and corporate income tax, with applicable rates ranging from 0%-13% and 0%-25% respectively. The company and some subsidiaries enjoy Western Development corporate income tax incentives, taxed at 15%; some small low-profit enterprises enjoy income tax incentives; Honghu Agriculture's income from agriculture, forestry, animal husbandry, and fishery projects is exempt from corporate income tax Main Tax Categories and Rates | Tax Category | Tax Basis | Tax Rate | | :--- | :--- | :--- | | Value-Added Tax | Based on sales of goods and taxable services calculated according to tax laws, after deducting deductible input VAT for the current period, the difference is VAT payable | 0%, 5%, 6%, 9%, 13% | | Corporate Income Tax | Calculated based on taxable income | 25%, 15%, 5%, 0% | - The company and some subsidiaries (e.g., Hongqi Wholesale, Wuhou Hongqi) qualify for Western Development policies and pay corporate income tax at a reduced rate of 15%[253] - Some subsidiaries (e.g., Hongqi Consulting, Sichuan Hongqi) qualify for small low-profit enterprise income tax incentives[254] - Honghu Agriculture's income from agriculture, forestry, animal husbandry, and fishery projects is exempt from corporate income tax[254] Notes to Consolidated Financial Statement Items This chapter details the period-end balances, period-beginning balances, and changes in major items in the consolidated financial statements, including cash and cash equivalents, accounts receivable, inventories, long-term equity investments, fixed assets, right-of-use assets, intangible assets, long-term deferred expenses, deferred income tax assets/liabilities, accounts payable, contract liabilities, employee benefits payable, retained earnings, operating revenue and costs, various expenses, and investment income, along with detailed accounting treatment explanations and composition analysis Cash and Cash Equivalents As of June 30, 2025, the company's cash and cash equivalents balance was CNY 2.42 billion, a decrease from CNY 2.50 billion at the beginning of the period. Bank deposits accounted for the vast majority. According to regulatory requirements, CNY 9.53 million in bank deposits were frozen due to the sale of Hongqi prepaid cards Cash and Cash Equivalents Composition | Item | Period-end Balance (CNY) | Period-beginning Balance (CNY) | | :--- | :--- | :--- | | Cash on hand | 3,093,523.89 | 10,862,806.49 | | Bank deposits | 2,420,414,912.99 | 2,493,907,691.23 | | Total | 2,423,508,436.88 | 2,504,770,497.72 | - The company had CNY 9.53 million in bank deposits frozen due to the sale of Hongqi prepaid cards, which has been excluded in the preparation of the cash flow statement[256] Accounts Receivable As of June 30, 2025, the company's accounts receivable book value was CNY 96.98 million, a decrease from CNY 120 million at the beginning of the period. Accounts receivable for which bad debt provisions were individually recognized amounted to CNY 9.40 million, and those for which bad debt provisions were recognized in combination amounted to CNY 97.03 million. The top five debtors' accounts receivable totaled CNY 29.38 million, accounting for 27.60% of the total period-end balance of accounts receivable and contract assets Accounts Receivable Aging Composition | Aging | Period-end Book Balance (CNY) | Period-beginning Book Balance (CNY) | | :--- | :--- | :--- | | Within 1 year (inclusive) | 96,932,261.22 | 120,456,296.96 | | 1 to 2 years | 7,009,470.00 | 7,009,470.00 | | 2 to 3 years | 2,483,000.00 | 2,483,000.00 | | Total | 106,424,731.22 | 129,948,766.96 | Accounts Receivable Bad Debt Provision Classification Disclosure | Category | Period-end Book Balance (CNY) | Bad Debt Provision (CNY) | Book Value (CNY) | | :--- | :--- | :--- | :--- | | Accounts receivable for which bad debt provisions are individually recognized | 9,397,520.00 | 9,397,520.00 | 0 | | Accounts receivable for which bad debt provisions are recognized in combination | 97,027,211.22 | 51,770.14 | 96,975,441.08 | | Total | 106,424,731.22 | 9,449,290.14 | 96,975,441.08 | - The top five period-end accounts receivable and contract assets totaled CNY 29.38 million, accounting for 27.60% of the total period-end balance of accounts receivable and contract assets[265] Other Receivables As of June 30, 2025, the company's other receivables book value was CNY 75.55 million, a decrease from CNY 86.96 million at the beginning of the period. The main nature of the amounts was deposits within the contract validity period and store and department petty cash. The aging was primarily over 3 years, with a bad debt provision of CNY 0.34 million Other Receivables Classified by Nature of Amount | Nature of Amount | Period-end Book Balance (CNY) | Period-beginning Book Balance (CNY) | | :--- | :--- | :--- | | Deposits within contract validity period | 65,339,711.38 | 78,293,504.25 | | Store and department petty cash | 6,484,368.00 | 6,499,300.00 | | Value-added service fees | 536,668.74 | 90,181.14 | | Other | 3,532,285.86 | 2,416,017.52 | | Total | 75,893,033.98 | 87,299,002.91 | Other Receivables Aging Composition | Aging | Period-end Book Balance (CNY) | Period-beginning Book Balance (CNY) | | :--- | :--- | :--- | | Within 1 year (inclusive) | 4,811,841.96 | 14,912,063.85 | | 1 to 2 years | 12,060,000.00 | 8,564,043.99 | | 2 to 3 years | 3,230,271.60 | 3,202,339.60 | | Over 3 years | 55,790,920.42 | 60,620,555.47 | | Total | 75,893,033.98 | 87,299,002.91 | - The period-end balance of other receivables bad debt provision was CNY 342,738.21, consistent with the period-beginning balance[274][278] Prepayments As of June 30, 2025, the company's prepayments balance was CNY 81.54 million, a decrease from CNY 102 million at the beginning of the period. Prepayments with an aging of within 1 year accounted for 94.82%. The top five prepayments totaled CNY 47.76 million, accounting for 58.57% of the period-end balance Prepayments by Aging | Aging | Period-end Balance (CNY) | Proportion (%) | Period-beginning Balance (CNY) | Proportion (%) | | :--- | :--- | :--- | :--- | :--- | | Within 1 year | 77,314,251.26 | 94.82% | 95,937,608.16 | 94.42% | | 1 to 2 years | 4,225,078.35 | 5.18% | 5,672,679.09 | 5.58% | | Total | 81,539,329.61 | -- | 101,610,287.25 | -- | - The aggregated amount of the top five prepayments by concentration of prepaid parties at period-end was CNY 47.76 million, accounting for 58.57% of the total period-end balance of prepayments[283] Inventories As of June 30, 2025, the company's inventories book value was CNY 2.08 billion, a slight increase from CNY 2.05 billion at the beginning of the period. Inventories primarily consisted of merchandise and revolving materials, with no inventory impairment provisions recognized Inventories Classification | Item | Period-end Book Balance (CNY) | Period-end Book Value (CNY) | Period-beginning Book Balance (CNY) | Period-beginning Book Value (CNY) | | :--- | :--- | :--- | :--- | :--- | | Merchandise | 2,075,461,272.56 | 2,075,461,272.56 | 2,051,868,792.54 | 2,051,868,792.54 | | Revolving materials | 29,785.40 | 29,785.40 | 29,117.48 | 29,117.48 | | Total | 2,075,491,057.96 | 2,075,491,057.96 | 2,051,897,910.02 | 2,051,897,910.02 | Other Current Assets As of June 30, 2025, the company's other current assets balance was CNY 49.70 million, an increase from CNY 37.49 million at the beginning of the period, primarily consisting of VAT input tax to be deducted Other Current Assets Composition | Item | Period-end Balance (CNY) | Period-beginning Balance (CNY) | | :--- | :--- | :--- | | VAT input tax to be deducted | 49,702,943.19 | 37,487,087.27 | | Total | 49,702,943.19 | 37,487,087.27 | Long-term Equity Investments As of June 30, 2025, the company's long-term equity investments balance was CNY 1.27 billion, an increase from CNY 1.19 billion at the beginning of the period. The main increase in the current period was investment income of CNY 72.83 million from associate XW Bank recognized under the equity method Changes in Long-term Equity Investments | Investee | Period-beginning Balance (CNY) | Increase/Decrease in Current Period - Investment Income Recognized Under Equity Method (CNY) | Period-end Balance (CNY) | | :--- | :--- | :--- | :--- | | XW Bank | 1,193,007,032.55 | 72,832,273.51 | 1,265,839,306.06 | | Subtotal | 1,193,007,032.55 | 72,832,273.51 | 1,265,839,306.06 | | Total | 1,193,007,032.55 | 72,832,273.51 | 1,265,839,306.06 | Fixed Assets As of June 30, 2025, the company's fixed assets book value was CNY 952.87 million, a decrease from CNY 987 million at the beginning of the period. In the current period, the original value of fixed assets increased by CNY 3.42 million and decreased by CNY 5.04 million, while accumulated depreciation increased by CNY 37.28 million. Some property and building ownership certificates are still being processed Changes in Fixed Assets Book Value | Item | Period-end Book Value (CNY) | Period-beginning Book Value (CNY) | | :--- | :--- | :--- | | Property and Buildings | 846,339,918.21 | 864,691,127.54 | | Machinery and Equipment | 5,486,941.06 | 6,426,283.59 | | Transportation Equipment | 24,473,985.35 | 24,274,539.30 | | Electronic Equipment | 13,204,251.14 | 15,532,565.46 | | Office and Other Equipment | 58,900,225.89 | 70,511,134.98 | | Fixed Asset Improvements | 4,466,034.24 | 5,632,310.61 | | Total | 952,871,355.89 | 987,067,961.48 | - The original value of fixed assets increased by CNY 3.42 million and decreased by CNY 5.04 million in the current period[293] - Ownership certificates for CNY 113.63 million of property and buildings are still being processed[296] Right-of-use Assets As of June 30, 2025, the company's right-of-use assets book value was CNY 954.61 million, a decrease from CNY 1.04 billion at the beginning of the period. In the current period, the original value of right-of-use assets increased by CNY 215 million and decreased by CNY 297 million, while accumulated depreciation increased by CNY 304 million Right-of-use Assets Information | Item | Period-end Book Value (CNY) | Period-beginning Book Value (CNY) | | :--- | :--- | :--- | | Property and Buildings | 954,614,768.25 | 1,044,296,906.75 | | Total | 954,614,768.25 | 1,044,296,906.75 | - The original value of right-of-use assets increased by CNY 215.08 million and decreased by CNY 297.42 million in the current period[297] - Depreciation of right-of-use assets for the current period was CNY 304.28 million[297] Intangible Assets As of June 30, 2025, the company's intangible assets book value was CNY 81.22 million, a decrease from CNY 95.49 million at the beginning of the period. Intangible assets primarily include land use rights, marketing networks, and software. In the current period, the original value of intangible assets increased by CNY 0.20 million and decreased by CNY 6.11 million, while accumulated amortization increased by CNY 17.57 million Changes in Intangible Assets Book Value | Item | Period-end Book Value (CNY) | Period-beginning Book Value (CNY) | | :--- | :--- | :--- | | Land Use Rights | 62,719,703.10 | 63,873,322.20 | | Marketing Network | 17,567,462.62 | 30,670,809.62 | | Software | 928,469.56 | 949,721.24 | | Total | 81,215,635.28 | 95,493,852.88 | - The original value of intangible assets increased by CNY 0.20 million (acquisition) and decreased by CNY 6.11 million (disposal) in the current period[299] - Accumulated amortization of intangible assets increased by CNY 17.57 million in the current period[299] Long-term Deferred Expenses As of June 30, 2025, the company's long-term deferred expenses balance was CNY 17.29 million, a decrease from CNY 21.92 million at the beginning of the period. This primarily includes leased store renovations and improvements, and vegetable base reconstruction, with an amortization amount of CNY 7.64 million in the current period Changes in Long-term Deferred Expenses | Item | Period-beginning Balance (CNY) | Amount Increased in Current Period (CNY) | Amount Amortized in Current Period (CNY) | Period-end Balance (CNY) | | :--- | :--- | :--- | :--- | :--- | | Leased Store Renovations and Improvements | 20,987,402.34 | 3,008,914.01 | 7,528,631.29 | 16,467,685.06 | | Vegetable Base Reconstruction | 932,668.93 | 0 | 109,832.88 | 822,836.05 | | Total | 21,920,071.27 | 3,008,914.01 | 7,638,464.17 | 17,290,521.11 | Deferred Income Tax Assets/Deferred Income Tax Liabilities As of June 30, 2025, the company's deferred income tax assets balance was CNY 44.36 million, and deferred income tax liabilities balance was CNY 0 (after offset). Deferred income tax assets primarily arose from lease expenses, accrued but unpaid points, deferred income, and credit impairment losses. Deferred income tax liabilities primarily arose from right-of-use assets Undiscounted Deferred Income Tax Assets | Item | Period-end Deductible Temporary Differences (CNY) | Period-end Deferred Income Tax Assets (CNY) | | :--- | :--- | :--- | | Lease Expenses | 1,07