TL NATURAL GAS(08536) - 2025 - 中期财报

Company Information and Report Statements This section outlines TL Natural Gas Holdings Limited's GEM listing, its corporate profile, and the report's compliance and definitions Company Profile and GEM Characteristics TL Natural Gas Holdings Limited, listed on GEM (stock code 8536), is incorporated in the Cayman Islands, with GEM offering listing opportunities for SMEs but carrying higher investment risks - Company name: TL Natural Gas Holdings Limited, stock code 8536, incorporated in Cayman Islands, listed on HKEX GEM[1] - HKEX GEM market provides listing platform for SMEs but involves higher investment risks, potential market volatility, and no guarantee of high liquidity[2] Report Statements and Definitions This report's information complies with GEM Listing Rules, with directors assuming full responsibility for accuracy, and all currency values are in RMB, defining CNG and LNG - Report information published in compliance with HKEX GEM Listing Rules; directors assume full responsibility for accuracy, completeness, and non-misleading nature[3] - All currency values in the report are presented in Renminbi ("RMB")[4] - Compressed Natural Gas (CNG) refers to high-pressure compressed natural gas used as a clean alternative vehicle fuel; Liquefied Natural Gas (LNG) refers to natural gas converted into liquid form[4] Unaudited Condensed Consolidated Financial Results This section presents the unaudited condensed consolidated financial statements, including income, comprehensive income, financial position, equity changes, and cash flows Condensed Consolidated Statement of Profit or Loss For the six months ended June 30, 2025, group revenue decreased to RMB 42,882 thousand, while loss for the period narrowed to RMB 2,679 thousand Condensed Consolidated Statement of Profit or Loss Key Data (For the six months ended June 30) | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenue | 42,882 | 44,424 | (1,542) | -3.47% | | Cost of sales | (39,263) | (40,563) | 1,300 | -3.20% | | Gross profit | 3,619 | 3,861 | (242) | -6.27% | | Loss before tax | (2,679) | (4,000) | 1,321 | -33.03% | | Loss for the period | (2,679) | (4,497) | 1,818 | -40.43% | | Loss for the period attributable to owners of the Company | (2,679) | (4,423) | 1,744 | -39.43% | Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income For the six months ended June 30, 2025, total comprehensive expense for the period significantly decreased to RMB 2,977 thousand, driven by a narrower loss and improved exchange differences Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income Key Data (For the six months ended June 30) | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Loss for the period | (2,679) | (4,497) | 1,818 | -40.43% | | Exchange differences on translating foreign operations | – | (1,958) | 1,958 | -100.00% | | Exchange differences on translating financial statements of the Company | (298) | 977 | (1,275) | -130.50% | | Other comprehensive expense for the period (net of tax) | (298) | (981) | 683 | -69.62% | | Total comprehensive expense for the period | (2,977) | (5,478) | 2,501 | -45.66% | Condensed Consolidated Statement of Financial Position As of June 30, 2025, total assets increased to RMB 64,367 thousand, with net assets rising to RMB 55,880 thousand and net current assets to RMB 40,215 thousand Condensed Consolidated Statement of Financial Position Key Data (As of June 30) | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | Change (thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Total non-current assets | 15,793 | 19,997 | (4,204) | -21.02% | | Total current assets | 48,574 | 42,204 | 6,370 | 15.10% | | Total current liabilities | 8,359 | 8,324 | 35 | 0.42% | | Net current assets | 40,215 | 33,880 | 6,335 | 18.69% | | Net assets | 55,880 | 53,298 | 2,582 | 4.85% | | Total equity | 55,880 | 53,298 | 2,582 | 4.85% | Condensed Consolidated Statement of Changes in Equity For the six months ended June 30, 2025, total equity attributable to owners increased to RMB 55,880 thousand, primarily due to new share issuance proceeds, partially offset by loss and exchange differences - Total equity attributable to owners of the Company was RMB 55,880 thousand as of June 30, 2025, an increase from RMB 53,298 thousand as of January 1, 2025[11] - The increase in equity was primarily due to net proceeds from share issuance of RMB 5,559 thousand, partially offset by a loss for the period of RMB 2,679 thousand and a decrease in exchange fluctuation reserve of RMB 298 thousand[11] - Lapse of share options resulted in a decrease in share option reserve of RMB 4,300 thousand and a corresponding increase in accumulated losses[11] Condensed Consolidated Statement of Cash Flows For the six months ended June 30, 2025, net cash and cash equivalents increased by RMB 2,521 thousand, reaching RMB 32,101 thousand at period-end, with reduced net cash used in operating activities and increased net cash from financing activities Condensed Consolidated Statement of Cash Flows Key Data (For the six months ended June 30) | Indicator | 2025 (RMB thousands) | 2024 (RMB thousands) | Change (thousands) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Net cash used in operating activities | (2,769) | (3,506) | 737 | -21.02% | | Net cash from investing activities | 31 | 79 | (48) | -60.76% | | Net cash from financing activities | 5,259 | 2,932 | 2,327 | 79.37% | | Net increase (decrease) in cash and cash equivalents | 2,521 | (495) | 3,016 | -609.29% | | Cash and cash equivalents at end of period | 32,101 | 27,913 | 4,188 | 15.00% | Notes to the Condensed Consolidated Interim Financial Statements This section provides detailed notes to the financial statements, covering general information, accounting policies, segment information, and other financial disclosures General Information The Company, incorporated in the Cayman Islands and listed on the Stock Exchange, primarily engages in natural gas sales and digital marketing services, with Yong Sheng Industrial Limited and Hong Sheng Industrial Limited as its holding and ultimate holding companies - The Company is incorporated in the Cayman Islands and its shares are listed on the Stock Exchange[14] - The Group's principal activities are natural gas sales and provision of digital marketing services[15] - The Company's holding company and ultimate holding company are Yong Sheng Industrial Limited and Hong Sheng Industrial Limited, respectively[14] Basis of Preparation and Principal Accounting Policies The condensed consolidated financial statements are prepared under HKAS 34 and GEM Listing Rules, using the historical cost convention, consistent with prior year policies, with no significant impact from new HKFRS amendments - The condensed consolidated financial statements are prepared in accordance with Hong Kong Accounting Standard 34 and the applicable disclosure requirements of the GEM Listing Rules[16] - The financial statements are prepared on a historical cost basis, and accounting policies are consistent with the annual consolidated financial statements for the year ended December 31, 2024[17] - Newly applied amendments to Hong Kong Financial Reporting Standards (HKAS 21 amendments) have no significant impact on the Group's financial position and performance[19] Revenue and Operating Segment Information The Group's main operating segments are natural gas sales and digital marketing services, with natural gas sales being the primary revenue source, while other segments do not meet reportable thresholds - The Group's reportable segments include sales of compressed natural gas and liquefied natural gas, natural gas transmission services ("Natural Gas Sales"), and provision of digital marketing services[21] - Other operating segments, such as automatic car wash services and fast-food catering services, do not meet the quantitative thresholds for reportable segments and are classified as "Others"[21] Reportable Segments This section details the revenue and segment results for the Group's reportable segments, primarily natural gas sales and digital marketing services 2025 First Half Segment Revenue and Results | Segment | Revenue (RMB thousands) | Segment Results (RMB thousands) | | :--- | :--- | :--- | | Natural Gas Sales | 42,882 | (574) | | Digital Marketing Services | – | (364) | | Others | – | (129) | | Total | 42,882 | (1,067) | 2024 First Half Segment Revenue and Results | Segment | Revenue (RMB thousands) | Segment Results (RMB thousands) | | :--- | :--- | :--- | | Natural Gas Sales | 44,424 | (974) | | Digital Marketing Services | – | (244) | | Others | – | (113) | | Total | 44,424 | (1,331) | Revenue Disaggregation and Geographical Information All the Group's revenue is generated from customers in China, primarily from CNG and LNG sales, with all non-current assets also located in China Customer Contract Revenue Disaggregation (For the six months ended June 30) | Type of Goods or Services | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Sales of compressed natural gas and liquefied natural gas | 42,882 | 44,424 | | Total Revenue | 42,882 | 44,424 | - During the reporting period, all the Group's revenue was generated from customers located in China[26] - As of June 30, 2025, all non-current assets by geographical location were in China, amounting to RMB 15,793 thousand[27] Major Customer Information The Group did not have any major customers whose revenue accounted for 10% or more of the Group's total revenue during the two periods - The Group had no major customers whose revenue amounted to or exceeded 10% of the Group's total revenue for the two periods[28] Other Income, Gains and Other Losses For the six months ended June 30, 2025, total other income, gains, and other losses decreased to RMB 88 thousand, mainly due to lower bank interest income Other Income, Gains and Other Losses (For the six months ended June 30) | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Bank interest income | 75 | 137 | | Net exchange loss | (1) | (1) | | Miscellaneous income | 14 | 23 | | Total | 88 | 159 | Loss Before Tax For the six months ended June 30, 2025, the Group's loss before tax was primarily driven by cost of inventories sold, depreciation, amortization, utility expenses, transportation expenses, auditor's remuneration, and employee benefit expenses Loss Before Tax Major Components (For the six months ended June 30) | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Cost of inventories sold | 37,119 | 38,152 | | Depreciation of property, plant and equipment | 1,197 | 1,313 | | Depreciation of right-of-use assets | 276 | 520 | | Amortisation of other intangible assets | 28 | 5 | | Employee benefit expenses | 3,055 | 3,148 | Finance Costs For the six months ended June 30, 2025, the Group's finance costs decreased to RMB 14 thousand, primarily consisting of interest on lease liabilities Finance Costs (For the six months ended June 30) | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Interest on lease liabilities | 14 | 26 | Tax For the six months ended June 30, 2025, the Group did not provide for current income tax expense due to no taxable profit and no significant deferred tax, with Chinese subsidiaries subject to a 25% corporate income tax rate Tax Analysis (For the six months ended June 30) | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Current tax – China | – | – | | Deferred tax | – | 497 | | Total tax for the period | – | 497 | - The Group is not subject to income tax in the Cayman Islands and British Virgin Islands, and no Hong Kong profits tax was provided for Hong Kong subsidiaries due to no assessable profits[33] - Chinese subsidiaries are subject to corporate income tax at a statutory rate of 25%[33] Loss Per Share For the six months ended June 30, 2025, basic loss per share attributable to owners narrowed to RMB (1.46) cents, with diluted loss per share being the same due to the anti-dilutive effect of share options Loss Per Share Calculation (For the six months ended June 30) | Indicator | 2025 | 2024 | | :--- | :--- | :--- | | Loss attributable to ordinary equity holders of the Company (RMB thousands) | (2,679) | (4,423) | | Weighted average number of ordinary shares (thousands) | 183,839 | 182,249 | | Basic loss per share (cents) | (1.46) | (2.43) | - Diluted loss per share is the same as basic loss per share because the outstanding share options had an anti-dilutive effect on the basic loss per share amount[35] Dividends The Board did not declare any dividends for the six months ended June 30, 2025, consistent with the prior period - The Board did not declare any dividends for the six months ended June 30, 2025 (six months ended June 30, 2024: nil)[36] Movements in Property, Plant and Equipment and Right-of-Use Assets During the interim period, the Group acquired property, plant, and equipment at a cost of RMB 44 thousand, a decrease from the prior period, with no additions to right-of-use assets in either period - The Group acquired property, plant and equipment at a cost of RMB 44 thousand during the interim period, a decrease from RMB 58 thousand in the prior period[37] - No additions to right-of-use assets were identified in either period[38] Trade Receivables As of June 30, 2025, net trade receivables slightly increased to RMB 1,886 thousand, with a typical credit period of one month and no collateral held Net Trade Receivables (As of June 30) | Indicator | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Gross trade receivables | 1,907 | 1,816 | | Less: Provision for expected credit losses | (21) | (14) | | Net trade receivables | 1,886 | 1,802 | - The Group primarily enters into trade terms with customers on credit, with a typical credit period of one month, and holds no collateral or other credit enhancements for trade receivable balances[39] Trade Receivables Ageing Analysis (As of June 30) | Ageing | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Within 3 months | 1,886 | 1,802 | Trade Payables As of June 30, 2025, total trade payables significantly decreased to RMB 22 thousand, with supplier credit periods ranging from 30 to 90 days Trade Payables Ageing Analysis (As of June 30) | Ageing | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Within 3 months | – | 119 | | 3 to 6 months | 22 | – | | Total | 22 | 119 | - The Group is generally granted credit periods ranging from 30 to 90 days by its suppliers[43] Share Capital As of June 30, 2025, the Company's issued and fully paid share capital increased to RMB 7,280 thousand, comprising 212,505,000 shares, primarily due to the issuance of 29,310,000 new shares during the period Share Capital Movements (As of June 30) | Indicator | June 30, 2025 (Number of Shares) | June 30, 2025 (RMB thousands) | December 31, 2024 (Number of Shares) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | :--- | :--- | | At beginning of period/year | 183,195,000 | 6,210 | 183,195,000 | 5,990 | | Shares issued | 29,310,000 | 1,070 | 5,940,000 | 220 | | At end of period/year | 212,505,000 | 7,280 | 189,135,000 | 6,210 | - On June 27, 2025, 29,310,000 shares were placed at HK$0.225 per share under the terms of a placing agreement, generating gross proceeds of approximately RMB 6,018 thousand and net proceeds of approximately RMB 5,559 thousand[44] Related Party Transactions For the six months ended June 30, 2025, total remuneration paid to key management personnel decreased to RMB 515 thousand Key Management Personnel Remuneration (For the six months ended June 30) | Item | 2025 (RMB thousands) | 2024 (RMB thousands) | | :--- | :--- | :--- | | Short-term employee benefits | 507 | 581 | | Contributions to pension schemes | 8 | 8 | | Total remuneration paid to key management personnel | 515 | 589 | Management Discussion and Analysis This section provides a review of the Group's business operations, financial performance, future outlook, capital structure, and other relevant management insights Business Review The Group primarily operates in Jingzhou, Hubei Province, China, focusing on CNG and LNG sales and transmission services, procuring CNG from PetroChina and distributing to retail and wholesale customers - The Group's principal place of business is in Jingzhou, Hubei Province, China, engaging in CNG and LNG sales and transmission services[46] - The Group primarily supplies CNG, with revenue derived from distributing CNG to retail customers (vehicle end-users) and wholesale customers (city gas companies, gas station operators, and industrial users), procuring natural gas from PetroChina Company Limited[47] - The Group also supplies LNG to some wholesale customers[47] Financial Review For the six months ended June 30, 2025, the Group's revenue decreased by 3.38% to RMB 42.9 million, while loss for the period narrowed by 38.6% to RMB 2.7 million, with a slight decline in gross profit margin and a significant reduction in administrative expenses Revenue Total revenue for the six months ended June 30, 2025, decreased by 3.38% to RMB 42.9 million, with increased LNG sales offsetting declines in wholesale CNG sales Revenue Composition and Change (For the six months ended June 30) | Revenue Source | 2025 (RMB millions) | 2024 (RMB millions) | Change (millions) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Total Revenue | 42.9 | 44.4 | (1.5) | -3.38% | | Sales of CNG to wholesale customers | 12.9 | 17.6 | (4.7) | -26.7% | | Sales of CNG to retail customers | 6.6 | 6.2 | 0.4 | 6.5% | | Sales of LNG | 23.4 | 20.6 | 2.8 | 13.6% | - The increase in LNG sales revenue was due to increased local community demand[48] Cost of Sales Cost of sales for the six months ended June 30, 2025, decreased by 3.2% to RMB 39.3 million, primarily due to a reduction in the cost of inventories sold Cost of Sales Change (For the six months ended June 30) | Indicator | 2025 (RMB millions) | 2024 (RMB millions) | Change (millions) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Cost of sales | 39.3 | 40.6 | (1.3) | -3.2% | | Cost of inventories sold | 37.1 | 38.2 | (1.1) | -2.9% | Gross Profit Gross profit for the six months ended June 30, 2025, decreased by 7.69% to RMB 3.6 million, with the gross profit margin slightly declining to 8.4% Gross Profit and Gross Profit Margin Change (For the six months ended June 30) | Indicator | 2025 (RMB millions) | 2024 (RMB millions) | Change (millions) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Gross profit | 3.6 | 3.9 | (0.3) | -7.69% | | Gross profit margin | 8.4% | 8.7% | -0.3% | -3.45% | - The decrease in gross profit margin was mainly due to price guidance from Hubei Provincial Price Bureau and Jingzhou Price Bureau, which prevented the full pass-through of increased natural gas procurement costs, and the low gross profit margin of LNG sales[50] Selling and Distribution Expenses Selling and distribution expenses remained stable at approximately RMB 0.3 million for the six months ended June 30, 2025 - Selling and distribution expenses, primarily staff costs and other office expenses for the operating department, remained stable at approximately RMB 0.3 million for the six months ended June 30, 2025[51] Administrative Expenses Administrative expenses for the six months ended June 30, 2025, decreased significantly by 20.8% to RMB 6.1 million, mainly due to reduced legal, professional, and consulting fees, and lower staff costs Administrative Expenses Change (For the six months ended June 30) | Indicator | 2025 (RMB millions) | 2024 (RMB millions) | Change (millions) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Administrative expenses | 6.1 | 7.7 | (1.6) | -20.8% | - The decrease in administrative expenses was mainly due to a reduction of approximately RMB 0.7 million in legal and professional fees and consulting fees, and a reduction of approximately RMB 0.4 million in staff costs[52] Finance Costs Finance costs primarily represent interest on lease liabilities - Finance costs refer to interest on lease liabilities[53] Tax For the six months ended June 30, 2025, the Group did not provide for current income tax expense due to no taxable profit and no significant deferred tax - For the six months ended June 30, 2025, the Group did not provide for current income tax expense as no assessable profits were generated during the period and there was no significant deferred tax[54] Loss for the Period Loss attributable to owners for the six months ended June 30, 2025, narrowed by 38.6% to RMB 2.7 million, primarily due to reduced administrative expenses Loss for the Period Attributable to Owners of the Company Change (For the six months ended June 30) | Indicator | 2025 (RMB millions) | 2024 (RMB millions) | Change (millions) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Loss attributable to owners of the Company | 2.7 | 4.4 | (1.7) | -38.6% | - The decrease in loss was mainly due to a reduction in administrative expenses from approximately RMB 7.7 million to approximately RMB 6.1 million[55] Prospects Despite global economic challenges, the Group is optimistic about China's natural gas consumption growth driven by clean energy policies, actively exploring new business opportunities, mitigating risks, and prudently considering new investments - The global economic landscape is expected to remain challenging, with geopolitical tensions and a slowdown in China's property market potentially prolonging financial difficulties and hindering growth[56] - The Group is optimistic about China's natural gas consumption growth, benefiting from the Chinese government's promotion of clean energy (coal-to-gas conversion) and pollution control policies[56] - The Group will actively explore new business opportunities, diversify revenue streams, mitigate risks, and prudently consider new investments to enhance shareholder value[56] Dividends The Board does not recommend paying any dividends for the six months ended June 30, 2025, consistent with the prior period - The Board does not recommend paying any dividends for the six months ended June 30, 2025 (six months ended June 30, 2024: nil)[57] Capital Structure, Liquidity and Financial Resources As of June 30, 2025, the Group had total equity of approximately RMB 55.9 million and cash and cash equivalents of RMB 32.1 million, demonstrating sufficient working capital and liquidity with no interest-bearing bank borrowings Capital Structure and Liquidity (As of June 30) | Indicator | June 30, 2025 (RMB millions) | | :--- | :--- | | Total equity | 55.9 | | Cash and cash equivalents | 32.1 | | Working capital (Net current assets) | 40.2 | | Current ratio | 5.8 | - The Group has no interest-bearing bank borrowings, thus the gearing ratio is not applicable[58] - Given stable operating cash inflows and sufficient cash balances, the Group possesses adequate liquidity and financial resources[58] Prepayments and Other Receivables As of June 30, 2025, prepayments and other receivables increased to RMB 14.5 million, primarily comprising supplier deposits and advances to third parties Prepayments and Other Receivables Composition (As of June 30) | Item | June 30, 2025 (RMB millions) | December 31, 2024 (RMB millions) | | :--- | :--- | :--- | | Total prepayments and other receivables | 14.5 | 10.9 | | Deposits to suppliers and advances to third parties | 8.7 | 4.9 | | Prepaid expenses | 3.3 | 3.5 | | Amounts due from directors | 2.5 | 2.5 | Commitments As of June 30, 2025, the Group had no contracted but unprovided capital commitments, compared to RMB 539 thousand for plant and machinery commitments as of December 31, 2024 Capital Commitments (As of June 30) | Item | June 30, 2025 (RMB thousands) | December 31, 2024 (RMB thousands) | | :--- | :--- | :--- | | Contracted, but not provided for: Plant and machinery | – | 539 | Contingent Liabilities and Guarantees As of June 30, 2025, the Group had no significant contingent liabilities and guarantees - As of June 30, 2025, the Group had no significant contingent liabilities and guarantees[61] Pledge of Assets As of June 30, 2025, the Group had no pledge of assets - As of June 30, 2025, the Group had no pledge of assets[62] Foreign Currency Risk The Group primarily operates in China with transactions denominated in RMB, experiencing no significant impact from exchange rate fluctuations during the period and undertaking no hedging transactions - The Group operates its business in China, with most transactions denominated in RMB, and did not experience significant impact or difficulties from exchange rate fluctuations on operating liquidity during the period[63] - The Group has not entered into any hedging transactions or forward contract arrangements[63] Interest Rate Risk The Group has no significant interest rate risk, currently lacks specific management policies, but will closely monitor future risks - The Group has no significant interest rate risk, currently has no specific policies for managing interest rate risk, and has not entered into any interest rate swap transactions[64] Material Investments, Material Acquisitions and Disposals of Subsidiaries, Associates and Joint Ventures and Future Plans for Material Investments or Capital Assets The Company held no material investments, acquisitions, or disposals of subsidiaries, associates, or joint ventures during the reporting period, and the Board currently has no other plans for material investments or capital asset increases - The Company held no material investments, nor any material acquisitions and disposals of subsidiaries, associates, and joint ventures during the period[65] - As of the date of this report, the Board has not authorized any other plans for material investments or increases in capital assets[66] Employees and Remuneration Policy As of June 30, 2025, the Group had 66 employees with staff costs of approximately RMB 3.1 million, and remuneration policy is based on market salaries, individual performance, commitment, and responsibilities, with training provided Employee Count and Costs (As of June 30) | Indicator | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total employees | 66 | 69 | | Staff costs (For the six months ended June 30, RMB millions) | 3.1 | 2.7 | - Remuneration is determined with reference to comparable market salaries, individual performance, commitment, and responsibilities, with relevant internal and/or external training provided[67] Fundraising Activities The Group conducted two placing activities during the reporting period, the 2024 and 2025 placings, aimed at expanding the shareholder base, capital base, and raising funds 2024 Placing On January 30, 2024, the Company successfully placed 5,940,000 shares at HK$0.658 per share, with proceeds allocated for renewable energy-related businesses and general working capital - On January 30, 2024, the Company successfully placed 5,940,000 shares at a placing price of HK$0.658 per share[69] 2024 Placing Proceeds Usage (HK$ millions) | Description | Intended Use Amount | Percentage of Net Proceeds | Utilized as of June 30, 2025 | Unutilized as of June 30, 2025 | | :--- | :--- | :--- | :--- | :--- | | Investment in renewable energy-related businesses | 1.5 | 50% | – | 1.5 | | General working capital | 1.5 | 50% | 1.5 | – | | Total | 3.0 | 100% | 1.5 | 1.5 | - The unutilized amount is expected to be utilized before the end of 2025[70] 2025 Placing On June 27, 2025, the Company successfully placed 29,310,000 shares at HK$0.225 per share, with proceeds intended for a potential joint venture in black pellet trading and general working capital - On June 27, 2025, the Company successfully placed 29,310,000 shares at a placing price of HK$0.225 per share[72] 2025 Placing Proceeds Usage (HK$ millions) | Description | Intended Use Amount | Percentage of Net Proceeds | Utilized as of June 30, 2025 | Unutilized as of June 30, 2025 | | :--- | :--- | :--- | :--- | :--- | | Possible establishment of a joint venture for trading black pellets | 3.0 | 50% | – | 3.0 | | General working capital | 3.0 | 50% | – | 3.0 | | Total | 6.0 | 100% | – | 6.0 | - The proposed investment in the joint venture is expected in 2025, and net proceeds for general working capital are expected to be utilized before 2026[73] Use of Proceeds The Company's net proceeds from its 2018 listing, approximately HK$29.2 million, were primarily for expanding the gas station network and upgrading the Jingzhou mother station, with the latter completed in 2021 and other station constructions awaiting government approval Use of Listing Proceeds This section details the allocation of net proceeds from the Company's 2018 listing, primarily for expanding the gas station network and upgrading the Jingzhou mother station Listing Proceeds Usage (HK$ thousands) | Description | Intended Use in Prospectus | Percentage of Net Proceeds | Actual Use as of June 30, 2025 | Unutilized Amount as of June 30, 2025 | | :--- | :--- | :--- | :--- | :--- | | Construction of a CNG gas station to expand the gas station network | 5,212 | 17.9% | 2,400 | 2,812 | | Construction of an integrated CNG/LNG gas station to expand the gas station network | 12,250 | 42.0% | 2,334 | 9,916 | | Upgrade of infrastructure and equipment at Jingzhou mother station to include LNG refueling capability | 8,772 | 30.1% | 8,772 | – | | Working capital and other general corporate purposes | 2,916 | 10.0% | 2,916 | – | | Total | 29,150 | 100.0% | 16,422 | 12,728 | Progress of Implementation Plan Plans for building CNG and integrated CNG/LNG stations are awaiting government approval, while the Jingzhou mother station upgrade was completed in 2021, and unutilized proceeds are held in licensed banks - Plans to construct CNG gas stations and integrated CNG/LNG gas stations have obtained equipment quotations, negotiated consultant terms, and submitted applications to the government, with completion expected by the end of 2025[76] - The implementation plan to upgrade infrastructure and equipment at the Jingzhou mother station to include LNG refueling capability was completed in 2021, and the mother station can now sell both CNG and LNG[76][77] - Due to the demolition of a sub-station, the Company has been seeking relocation opportunities, and other gas station constructions are awaiting approval from relevant government authorities[77] - As of June 30, 2025, the unutilized net proceeds were deposited in licensed banks in China[77] - The Directors do not anticipate any changes to the major plans for the use of proceeds[78] Other Information This section covers various other disclosures, including directors' and major shareholders' interests, share option schemes, compliance, and corporate governance Directors' and Chief Executive's Interests and/or Short Positions in Shares, Underlying Shares and Debentures of the Company and any Associated Corporations As of June 30, 2025, Executive Directors Mr. Liu Yongcheng and Mr. Liu Yongqiang, acting in concert, were deemed to have long positions in approximately 35.82% of the Company's total issued shares Directors' and Chief Executive's Long Positions in Ordinary Shares and Underlying Shares of the Company (As of June 30) | Name | Capacity/Nature of Interest | Number of Shares Held | Approximate Percentage of Total Issued Shares | | :--- | :--- | :--- | :--- | | Mr. Liu Yongcheng | Interest in controlled corporation and parties acting in concert | 76,125,000 | 35.82% | | Mr. Liu Yongqiang | Interest in controlled corporation and parties acting in concert | 76,125,000 | 35.82% | - Mr. Liu Yongcheng directly owns 100% interest in Yong Sheng Industrial Limited, which holds 19,392,500 shares. Mr. Liu Yongqiang directly owns 100% interest in Hong Sheng Industrial Limited, which holds 56,732,500 shares[81] - Mr. Liu Yongcheng and Mr. Liu Yongqiang are parties acting in concert, and thus are deemed or taken to be interested in the shares held by each other[81] Substantial Shareholders' Interests and/or Short Positions in Shares and Underlying Shares of the Company As of June 30, 2025, Yong Sheng Industrial Limited and Hong Sheng Industrial Limited, acting in concert, held approximately 35.82% interest each in the Company's issued shares, while An Wen Development Limited held 6.53% Substantial Shareholders' Long Positions in Ordinary Shares and Underlying Shares of the Company (As of June 30) | Name | Capacity | Number of Shares Held | Approximate Percentage of Total Issued Shares | | :--- | :--- | :--- | :--- | | Yong Sheng Industrial Limited | Beneficial owner and parties acting in concert | 76,125,000 | 35.82% | | Hong Sheng Industrial Limited | Beneficial owner and parties acting in concert | 76,125,000 | 35.82% | | An Wen Development Limited | Beneficial owner | 13,872,500 | 6.53% | - The interests of Yong Sheng Industrial Limited and Hong Sheng Industrial Limited are controlled by Mr. Liu Yongcheng and Mr. Liu Yongqiang, respectively, through direct shareholding and acting-in-concert agreements[84][85] - Mr. Yu Jianwei directly owns 100% interest in An Wen Development Limited[85] Share Option Scheme The Company's share option scheme was approved on April 20, 2018; all existing options lapsed during the six months ended June 30, 2025, with no expense recognized, and 8,500,000 new options were granted post-period on July 8, 2025 - The Share Option Scheme was approved and adopted by shareholders on April 20, 2018[86] - During the six months ended June 30, 2025, all existing share options lapsed, and no share option expense was recognized for the period[94] - The vesting period for share options is divided into three tranches: 30% from the grant date to expiry, 30% from the first anniversary of the grant date to expiry, and 40% from the second anniversary of the grant date to expiry[92] - Share options are exercisable for a period of five years from the grant date, with fair value calculated using the Binomial Option Pricing Model[92] - Subsequent to the end of the reporting period, on July 8, 2025, the Company granted a total of 8,500,000 share options, representing approximately 4.00% of the issued shares as of the date of this report[95] Directors' Rights to Acquire Shares For the six months ended June 30, 2025, the Company granted no rights to any directors or their associates to acquire benefits by purchasing the Company's shares or debentures - For the six months ended June 30, 2025, the Company did not grant any rights to any directors or their respective spouses or children under 18 years of age to acquire benefits by purchasing the Company's shares or debentures[96] Purchase, Sale or Redemption 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 of the Company's 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[97] Compliance with the Required Standard of Dealings by Directors in Securities Transactions The Company adopted the required standard of dealings for directors' securities transactions as per GEM Listing Rules, and all directors confirmed compliance for the six months ended June 30, 2025 - The Company has adopted the required standard of dealings as set out in Rules 5.48 to 5.67 of the GEM Listing Rules as its code of conduct for directors' securities transactions[98] - Following specific enquiries made to all Directors, all Directors confirmed their compliance with the required standard of dealings for the six months ended June 30, 2025[98] Non-Competition Undertaking The controlling shareholders signed a non-competition undertaking on April 20, 2018, and confirmed compliance during the reporting period, committing not to engage in any business competing with the Group - The Group's controlling shareholders signed a non-competition undertaking on April 20, 2018, and confirmed compliance with the undertaking during the period[99] - The controlling shareholders undertake not to directly or indirectly conduct, operate, or engage in any business that competes or may compete significantly with the existing business activities of any member of the Group[99] Competing Interests As of June 30, 2025, no directors, controlling shareholders, or substantial shareholders, or their close associates, held any positions or interests in businesses that compete significantly with the Group's operations - For the six months ended June 30, 2025, to the best knowledge of the Directors, no Directors, controlling shareholders, and substantial shareholders of the Company, or their respective close associates, held any positions or interests in any business or company that competes or may compete significantly with the Group's business[100] Corporate Governance Code The Company adopted and complied with the Corporate Governance Code in Appendix C1 of the GEM Listing Rules, with a deviation where the Chairman and Chief Executive are the same person, which the Board deems appropriate with proper checks and balances - The Company has adopted and complied with the Corporate Governance Code as set out in Appendix C1 to the GEM Listing Rules[101] - There is one deviation: the roles of Chairman and Chief Executive are performed by Mr. Liu Yongcheng, which deviates from Code Provision C.2.1[101] - The Board believes this deviation is appropriate as Mr. Liu Yongcheng is familiar with the Group's operations, and there are proper checks and balances exercised by the Board and three independent non-executive Directors[101] Update on Directors' Information For the six months ended June 30, 2025, no changes in directors' information required disclosure under GEM Listing Rule 17.50A(1) - For the six months ended June 30, 2025, no changes in directors' information were required to be disclosed pursuant to Rule 17.50A(1) of the GEM Listing Rules[102] Audit and Risk Management Committee The Company established an Audit and Risk Management Committee, comprising three independent non-executive directors, which reviewed the Group's unaudited condensed consolidated financial statements and this report for the six months ended June 30, 2025 - The Company has established an Audit and Risk Management Committee, whose written terms of reference comply with Code Provision D.3.3 of the Corporate Governance Code[103] - The Committee comprises three independent non-executive Directors: Mr. Yang Zhenyu (Chairman), Ms. Luo Hongru, and Ms. Zeng Li[103] - The Committee has reviewed the Group's unaudited condensed consolidated financial statements and this report for the six months ended June 30, 2025[103] Post-Balance Sheet Events Except as disclosed in this report, no significant events occurred after the end of the reporting period - Save as disclosed in this report, no significant events occurred after the end of the reporting period[104] Forward-Looking Statements This report contains forward-looking statements regarding the Group's future financial condition, operating results, and business, which involve known and unknown risks and uncertainties that could cause actual results to differ materially from expectations - This report contains forward-looking statements regarding the Group's financial condition, operating results, and business[105] - These forward-looking statements involve known and unknown risks and uncertainties that could cause actual results, performance, or events to differ materially from expectations[105] By Order of the Board This report was issued by Mr. Liu Yongcheng, Chairman and Chief Executive Officer, on behalf of the Board on August 14, 2025, with the Board comprising three executive and three independent non-executive directors - This report was issued by Mr. Liu Yongcheng, Chairman and Chief Executive Officer, on behalf of the Board on August 14, 2025[106] - The Board comprises Executive Directors Mr. Liu Yongcheng, Mr. Liu Yongqiang, and Mr. Liu Yongsheng; and Independent Non-executive Directors Ms. Luo Hongru, Ms. Zeng Li, and Mr. Yang Zhenyu[106]