康希诺生物(06185) - 2025 - 中期业绩

Company Information Board of Directors and Management CanSino Biologics' board comprises executive, non-executive, and independent non-executive directors, with Dr. Xuefeng YU serving as Chairman, CEO, and General Manager, supported by established audit, remuneration, and nomination committees - Board members include Executive Directors Dr. Xuefeng YU (Chairman, CEO, and General Manager), Dr. Shou Bai CHAO (COO and Deputy General Manager), and Ms. Jing WANG (Chief Business Officer and Deputy General Manager)[5] - The Audit Committee consists of Mr. Yaoliang ZHANG (Chairman), Mr. Shuifa GUI, and Mr. Jianzhong LIU[5] Company Contact and Legal Information The company's headquarters and China registered office are in Tianjin, with its Hong Kong principal place of business in Causeway Bay, and Deloitte Touche Tohmatsu as its auditor - Headquarters and China registered office are located at 401–420, 4th Floor, Biomedical Park, South Street 185, West Area, Tianjin Economic-Technological Development Area, China[6] - Hong Kong principal place of business is located at Room 1901, 19th Floor, Lee Garden One, 33 Hysan Avenue, Causeway Bay, Hong Kong[6] - The auditor is Deloitte Touche Tohmatsu[6] Financial Summary Operating Results and Financial Position For the six months ended June 30, 2025, CanSino Biologics' revenue increased by 31.1% to 374.1 million RMB, operating loss significantly narrowed by 99.1% to 2.2 million RMB, and total assets and liabilities saw minor decreases H1 2025 Operating Results and Financial Position Summary | Indicator | H1 2025 (thousand RMB) | H1 2024 (thousand RMB) | Change (thousand RMB) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Operating Results | | | | | | Revenue | 374,088 | 285,420 | 88,668 | 31.1 | | Operating Loss | (2,208) | (250,466) | 248,258 | (99.1) | | Loss Before Income Tax | (19,303) | (229,196) | 209,893 | (91.6) | | Total Comprehensive Expenses for the Period | (13,527) | (229,666) | 216,139 | (94.1) | | Loss Per Share (RMB) | (0.05) | (0.91) | 0.86 | (94.0) | | Financial Position (as of June 30) | | | | | | Non-current Assets | 3,370,189 | 3,675,641 | (305,452) | (8.3) | | Current Assets | 4,334,839 | 4,282,491 | 52,348 | 1.2 | | Total Assets | 7,705,028 | 7,958,132 | (253,104) | (3.2) | | Total Equity | 4,903,405 | 4,909,872 | (6,467) | (0.1) | | Non-current Liabilities | 1,042,716 | 1,276,218 | (233,502) | (18.3) | | Current Liabilities | 1,758,907 | 1,772,042 | (13,135) | (0.7) | | Total Liabilities | 2,801,623 | 3,048,260 | (246,637) | (8.1) | | Total Equity and Liabilities | 7,705,028 | 7,958,132 | (253,104) | (3.2) | Management Discussion and Analysis Overview CanSino Biologics is dedicated to developing, manufacturing, and commercializing high-quality, innovative, and affordable vaccines, with a product pipeline spanning global innovative, China-first, and preclinical candidates across over ten disease areas - CanSino Biologics' mission is to research, develop, manufacture, and commercialize high-quality, innovative, and affordable vaccines[10] - The product pipeline is categorized into three types: global innovative vaccines (e.g., Convidecia®, Ad5-EBOV), China-first vaccines (e.g., Menhycia®, Menactra®, Youpeixin®), and preclinical pipeline vaccines (e.g., CS-2606 mRNA multivalent influenza vaccine)[10][11][12] Business Review CanSino Biologics achieved significant progress in vaccine R&D and commercialization, with strong sales growth for commercial products like Menhycia®, approval for Youpeixin®, and advancement of multiple pipeline vaccines and mRNA technology Research and Development CanSino Biologics' R&D focuses on market expansion for commercial products and clinical advancement of pipeline vaccines, including Menhycia®'s market penetration and international registration, Youpeixin®'s approval, and progress in various clinical trials and mRNA platform development Our Commercialized Products CanSino Biologics' commercialized products include Menhycia®, Menactra®, Youpeixin®, Convidecia® series, and Ad5-EBOV, with Menhycia® showing significant sales growth and international expansion, and Youpeixin® recently approved - Menhycia® is China's first and only MCV4 to receive NDA approval, with its applicable age group expanded to children aged 3 months to 6 years (83 months), and clinical trials initiated for adults aged 7 to 59 years[14][16] - Menhycia® generated sales revenue of approximately 363.7 million RMB during the reporting period, a 38.4% increase year-on-year[15] - Menhycia® has obtained a registration certificate and Halal certification from the Indonesian Food and Drug Supervisory Agency, which is beneficial for enhancing its overseas brand awareness[16] - Youpeixin® received NDA approval from the National Medical Products Administration in June 2025, becoming the first approved product in the company's pneumonia product portfolio[19] - Convidecia® Inhalable was included in emergency use in China as a booster vaccine since September 2022, and the XBB.1.5 variant vaccine was included in emergency use in China since December 2023[22] - Ad5-EBOV was approved in China in October 2017 as China's first Ebola virus vaccine, but is not expected to make significant commercial contributions in the future[23] Pipeline Vaccines in Clinical Trials CanSino Biologics' pipeline vaccines show significant progress, with NDA submissions for infant DTcP and tetanus vaccines, initiation of Phase II/III trials for adolescent/adult Tdcp, and advancement of recombinant polio, PBPV, recombinant zoster, and inhaled TB booster vaccines in various clinical stages - The NDA for infant DTcP has been accepted by the National Medical Products Administration and was granted priority review in February 2025[25] - The NDA for the tetanus vaccine has been accepted by the National Medical Products Administration, with approval expected in the first half of 2026, and an exclusive commercialization agreement for Greater China reached with Grand Pharma Life Sciences[27] - Phase II/III clinical trials for adolescent and adult Tdcp officially commenced in December 2024, with all subjects enrolled[29][30] - Recombinant polio vaccine initiated Phase I clinical trials in Australia in January 2024, Phase I/II clinical trials in Indonesia in December 2024, and received clinical trial approval from the National Medical Products Administration in July 2025[32][33] - Phase I clinical trials for PBPV yielded positive preliminary results, demonstrating good safety and broad-spectrum protection potential in adult and elderly populations[35] - Recombinant zoster vaccine initiated Phase I clinical trials in Canada in November 2023, utilizing both intramuscular injection and inhaled administration[37] - Inhaled tuberculosis booster vaccine received Phase I clinical trial approval from the Indonesian Food and Drug Supervisory Agency in May 2025[41] - DTcP–Hib–MCV4 combination vaccine received clinical trial approval from the National Medical Products Administration in February 2025, with Phase I clinical trials expected to commence before the end of 2025[42] Preclinical Programs with Proof-of-Concept CanSino Biologics maintains a diverse preclinical pipeline of preventive and combination vaccines targeting influenza, meningitis, and pneumonia, with updates on significant advancements to be provided as appropriate - The company has various pipeline vaccines in preclinical programs, including preventive vaccines targeting influenza, meningitis, pneumonia, and other combination vaccines[42] mRNA Platform CanSino Biologics has established an in-house mRNA technology platform with proprietary sequence optimization software and a completed Phase I manufacturing facility, actively pursuing international collaborations and developing advanced LNP delivery systems - The Group has established an mRNA technology platform with proprietary sequence optimization software and completed the Phase I construction of its mRNA vaccine manufacturing facility[43] - In July 2024, the Group signed a cooperation agreement with the National Institute of Biotechnology, Malaysia, focusing on the development, manufacturing, technology transfer, and talent exchange for innovative products such as mRNA multivalent influenza vaccines[43] - In June 2025, the Group successfully developed a novel ionizable sterol lipid (ISL)-based three-component lipid nanoparticle (ISL-3C-LNP) delivery system, demonstrating significant improvements in safety and enhanced cellular immune responses[44] The Group's Manufacturing Facilities CanSino Biologics operates commercial-scale manufacturing facilities in Tianjin for key products and has established an mRNA technology platform in Shanghai, with ongoing development of the CanSino Innovative Vaccine Industrial Park to enhance overall capabilities - The Group owns and operates a commercial-scale manufacturing facility in Tianjin for producing Menactra®, Menhycia®, and Youpeixin® products[45] - The Group has established an mRNA technology platform in Shanghai, which will undertake key technological research and large-scale production of mRNA vaccines[45] - The construction of the CanSino Innovative Vaccine Industrial Park project has commenced, aiming to enhance R&D, manufacturing, inspection, and warehousing capabilities to support long-term development strategies[45] Commercialization CanSino Biologics has built an efficient commercialization engine, leveraging precise marketing and academic promotion to increase Menhycia®'s market share, capitalize on product synergies for Youpeixin®, and expand internationally through local distributor networks - The company has built a well-functioning commercialization engine, combining the systematic management methods of multinational corporations with the decision-making flexibility and execution efficiency of biotechnology companies[46] - Menhycia® holds a unique competitive position in the market, with its market share steadily increasing; Youpeixin® is positioned as a high-end self-paid vaccine, overlapping with Menhycia®'s target consumer group, thus offering marketing synergies[48] - Through various academic and marketing promotion activities, the company introduces product features and the latest academic developments, assisting local CDC doctors in the rational use of products and establishing a positive brand image[49] Future and Prospects CanSino Biologics plans to enhance R&D platform management, ensure comprehensive quality control, intensify marketing and academic promotion, build a robust commercialization team, and expand international market presence through internal R&D and strategic partnerships - The company will actively carry out marketing activities, strengthen professional academic promotion, and enhance public understanding of vaccines and the necessity of vaccination[50] - It will continue to deepen R&D platform management, ensure comprehensive product quality control, and enhance long-term competitiveness through internal R&D and medical/clinical teams[50] - The company will actively seek global cooperation, consider acquiring potential assets, and continuously expand industrialization and commercialization coverage in Southeast Asia, the Middle East, and Latin America to accelerate its international market competitiveness[51] Financial Review CanSino Biologics' H1 2025 revenue grew 31.1% driven by meningococcal vaccines, with sales costs decreasing, gross profit increasing, and operating loss significantly narrowing due to improved efficiency and cost control across various expense categories Revenue For the six months ended June 30, 2025, CanSino Biologics' revenue reached 374.1 million RMB, a 31.1% year-on-year increase, primarily driven by strong sales of Menhycia® as China's first MCV4 vaccine, with revenue mainly from the China market - For the six months ended June 30, 2025, the Group's revenue was approximately 374.1 million RMB, an increase of approximately 88.7 million RMB (approximately 31.1%) compared to the same period last year[52] - Revenue growth was primarily driven by a significant increase in sales of Menhycia® as the first MCV4 vaccine product in the Chinese market[52] Revenue Breakdown by Vaccine Product Type | Vaccine Product Type | 2025 (thousand RMB) | 2024 (thousand RMB) | | :--- | :--- | :--- | | Meningococcal Vaccine Products | 363,675 | 262,720 | | COVID-19 Vaccine Products | 10,413 | 92 | | CDMO | – | 22,608 | | Total | 374,088 | 285,420 | Revenue Breakdown by Geographical Market | Market Region | 2025 (thousand RMB) | 2024 (thousand RMB) | | :--- | :--- | :--- | | China | 374,088 | 262,720 | | Overseas | – | 22,700 | | Total | 374,088 | 285,420 | Cost of Sales For the six months ended June 30, 2025, cost of sales decreased by 21.1% to 77.5 million RMB, primarily due to the elimination of excess capacity costs, which offset increased costs from higher meningococcal vaccine sales - Cost of sales was approximately 77.5 million RMB, a decrease of approximately 20.8 million RMB (approximately 21.1%) compared to the same period last year[55] - The main reason was the decrease in excess capacity costs from approximately 22.9 million RMB in H1 2024 to zero in H1 2025[55] Cost of Sales Components | Cost of Sales Component | 2025 (thousand RMB) | 2024 (thousand RMB) | | :--- | :--- | :--- | | Cost of Vaccine Product Sales | 65,768 | 49,066 | | CDMO Costs | – | 12,229 | | Impairment Loss on Inventories and Right of Return | 11,740 | 14,239 | | Impairment Loss on Prepayments | – | (153) | | Costs Incurred Due to Low Production Capacity Utilization | – | 22,888 | | Total | 77,508 | 98,269 | Gross Profit For the six months ended June 30, 2025, gross profit increased by 109.4 million RMB to 296.6 million RMB, with the gross margin for vaccine products rising to 79.3% due to a higher proportion of high-margin meningococcal vaccine sales, reduced excess capacity costs, and efficiency measures - Gross profit was approximately 296.6 million RMB, an increase of approximately 109.4 million RMB compared to the same period last year[57] - Gross margin for vaccine product sales increased from approximately 67.3% to approximately 79.3%[57] - The increase in gross margin was primarily due to a higher proportion of high-margin meningococcal vaccine product sales, a significant reduction in excess capacity costs, and continuous implementation of cost-saving and efficiency-enhancing measures[57] Gross Profit and Gross Margin Details | Product Type | 2025 Gross Profit (thousand RMB) | 2025 Gross Margin (%) | 2024 Gross Profit (thousand RMB) | 2024 Gross Margin (%) | | :--- | :--- | :--- | :--- | :--- | | Vaccine Products | 296,580 | 79.3 | 176,772 | 67.3 | | CDMO | – | – | 10,379 | 45.9 | | Total | 296,580 | 79.3 | 187,151 | 65.6 | Other Income For the six months ended June 30, 2025, other income increased by 74.4% to 94.4 million RMB, primarily due to increased government grants and international funding support driven by R&D pipeline progress and international collaborations - Other income increased by 74.4% from approximately 54.1 million RMB to approximately 94.4 million RMB[59] - The increase was primarily due to the progress of the Group's R&D pipeline and the initiation of international collaborations, resulting in more government grants and international funding support, leading to an increase in other income of approximately 48.9 million RMB[59] Selling Expenses For the six months ended June 30, 2025, selling expenses increased by 39.0% to 156.3 million RMB, primarily due to increased marketing expenditures to drive the commercialization of meningococcal vaccine products - Selling expenses increased by 39.0% from approximately 112.5 million RMB to approximately 156.3 million RMB[60] - This was primarily due to increased marketing expenditures to drive the commercialization of meningococcal vaccine products during the reporting period[60] Selling Expenses Components | Selling Expense Component | 2025 (thousand RMB) | 2025 Share (%) | 2024 (thousand RMB) | 2024 Share (%) | | :--- | :--- | :--- | :--- | :--- | | Promotion and Marketing Expenses | 83,334 | 53.3 | 54,517 | 48.5 | | Employee Benefit Expenses | 63,461 | 40.6 | 45,593 | 40.5 | | Travel and Transportation Expenses | 2,816 | 1.8 | 3,804 | 3.4 | | Others | 6,732 | 4.3 | 8,564 | 7.6 | | Total | 156,343 | 100.0 | 112,478 | 100.0 | Administrative Expenses For the six months ended June 30, 2025, administrative expenses decreased by 11.4% to 77.8 million RMB, primarily reflecting the company's ongoing efforts in cost control and efficiency improvement - Administrative expenses decreased by 11.4% from approximately 87.8 million RMB to approximately 77.8 million RMB[62] - The decrease was due to the company's continuous efforts in cost control and efficiency improvement[62] Administrative Expenses Components | Administrative Expense Component | 2025 (thousand RMB) | 2025 Share (%) | 2024 (thousand RMB) | 2024 Share (%) | | :--- | :--- | :--- | :--- | :--- | | Employee Benefit Expenses | 35,057 | 45.1 | 43,258 | 49.3 | | Depreciation and Amortization | 12,645 | 16.3 | 19,832 | 22.6 | | Office and Energy Expenses | 7,888 | 10.1 | 8,383 | 9.6 | | Professional Service Fees | 11,353 | 14.6 | 7,987 | 9.1 | | Taxes and Surcharges | 5,427 | 7.0 | 4,268 | 4.9 | | Others | 5,387 | 6.9 | 4,047 | 4.5 | | Total | 77,757 | 100.0 | 87,775 | 100.0 | Research and Development Expenses For the six months ended June 30, 2025, R&D expenses decreased by 20.5% to 147.8 million RMB, primarily due to the Group's focus on integrating R&D resources, leveraging synergies, and enhancing efficiency to concentrate on high-potential projects - R&D expenses decreased by 20.5% from approximately 185.9 million RMB to approximately 147.8 million RMB[65] - This was primarily due to the Group's strong emphasis on integrating R&D resources and potential synergies across different pipelines, enhancing R&D efficiency, reducing costs, and focusing R&D resources on high-potential projects[65] R&D Expenses Components | R&D Expense Component | 2025 (thousand RMB) | 2025 Share (%) | 2024 (thousand RMB) | 2024 Share (%) | | :--- | :--- | :--- | :--- | :--- | | Employee Benefit Expenses | 62,095 | 42.0 | 75,422 | 40.6 | | Depreciation and Amortization | 36,040 | 24.4 | 40,856 | 22.0 | | Raw Materials and Consumables | 16,997 | 11.5 | 23,290 | 12.5 | | Clinical Trial and Testing Fees | 16,972 | 11.5 | 29,706 | 16.0 | | Others | 15,690 | 10.6 | 16,628 | 8.9 | | Total | 147,794 | 100.0 | 185,902 | 100.0 | Other Gains (Losses), Net For the six months ended June 30, 2025, other gains, net, turned from a loss of 75.3 million RMB to a gain of 2.0 million RMB, primarily because the prior year's loss from losing control over Shanghai Pharma CanSino no longer occurred, and equity investments in unlisted companies turned profitable - Other gains and losses, net, turned from a loss of 75.3 million RMB in H1 2024 to a gain of 2.0 million RMB in H1 2025[67] - The primary reason for the change was the absence of the other net loss of 70.5 million RMB in the prior year due to losing control over Shanghai Pharma CanSino[67] - Equity investments in unlisted companies turned from a loss of 4.7 million RMB to a gain of 0.6 million RMB[67] Finance (Expenses or Losses) Income or Gains – Net For the six months ended June 30, 2025, net finance costs were 17.1 million RMB, a decrease of 38.4 million RMB from the prior year's net finance income of 21.3 million RMB, mainly due to foreign exchange losses, reduced interest income, and lower interest expenses from decreased bank borrowings - Net finance costs were approximately 17.1 million RMB, a decrease of approximately 38.4 million RMB compared to the prior year's net finance income of 21.3 million RMB[68] - Foreign exchange gains turned from a gain of 15.3 million RMB to a loss of 9.0 million RMB[68] - Interest income decreased by approximately 21.5 million RMB, as the Group strategically reduced its holdings of time deposits to reallocate capital to wealth management tools with higher return potential[68] - Increased sales and collections of meningococcal vaccine products provided sufficient operating capital, allowing the Group to reduce the scale of bank borrowings, leading to a decrease in interest expenses of 6.2 million RMB[68] Income Tax Credit (Expense) For the six months ended June 30, 2025, income tax credit was 5.8 million RMB, compared to an income tax expense of 1.0 million RMB in the prior year, primarily due to an increase in deferred tax assets during the reporting period - Income tax credit was approximately 5.8 million RMB (H1 2024: income tax expense of 1.0 million RMB)[69] - This was primarily due to an increase in deferred tax assets during the reporting period[69] Intangible Assets The Group's intangible assets increased from 180.1 million RMB as of December 31, 2024, to 210.7 million RMB as of June 30, 2025, primarily due to the capitalization of development costs for several pipeline vaccine products in Phase III and beyond - Intangible assets increased from approximately 180.1 million RMB as of December 31, 2024, to approximately 210.7 million RMB as of June 30, 2025[70] - This was primarily due to the capitalization of development costs for several pipeline vaccine products in Phase III and beyond, upon meeting capitalization criteria[70] Inventories The Group's inventories increased from 280.5 million RMB as of December 31, 2024, to 323.2 million RMB as of June 30, 2025, primarily to meet increased sales demand for meningococcal vaccines, while inventory write-downs decreased due to improved inventory planning - Inventories increased from approximately 280.5 million RMB as of December 31, 2024, to approximately 323.2 million RMB as of June 30, 2025[71] - This was primarily due to strengthened inventory production and sales coordination management, increasing finished goods inventory to meet continuously growing anticipated sales demand for meningococcal vaccines and ensure timely delivery[71] - Inventory write-down balance decreased from 439.7 million RMB as of December 31, 2024, to 407.2 million RMB as of June 30, 2025, achieving optimized inventory structure[71] Inventory Details | Inventory Category | June 30, 2025 Total (thousand RMB) | June 30, 2025 Write-down (thousand RMB) | June 30, 2025 Carrying Value (thousand RMB) | December 31, 2024 Total (thousand RMB) | December 31, 2024 Write-down (thousand RMB) | December 31, 2024 Carrying Value (thousand RMB) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Raw Materials and Consumables | 414,037 | 360,802 | 53,235 | 432,483 | 375,814 | 56,669 | | Work in Progress | 123,733 | 15,954 | 107,779 | 126,505 | 16,650 | 109,855 | | Finished Goods | 187,253 | 30,425 | 156,828 | 161,154 | 47,196 | 113,958 | | Goods in Transit | 5,382 | - | 5,382 | 40 | - | 40 | | Total | 730,405 | 407,181 | 323,224 | 720,182 | 439,660 | 280,522 | Trade Receivables The Group's trade receivables decreased from 737.6 million RMB as of December 31, 2024, to 660.3 million RMB as of June 30, 2025, primarily due to a significant increase in revenue and collections from meningococcal vaccine sales, providing ample working capital - Trade receivables decreased from approximately 737.6 million RMB as of December 31, 2024, to approximately 660.3 million RMB as of June 30, 2025[73] - This was primarily due to a significant increase in revenue and collections from meningococcal vaccine products, which provided ample working capital for the Group[73] Trade Receivables Ageing Analysis | Ageing | June 30, 2025 (thousand RMB) | December 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Within 180 days | 336,644 | 473,585 | | 180 days to 365 days | 226,035 | 91,874 | | 1 to 2 years | 65,379 | 116,687 | | Over 2 years | 76,496 | 87,347 | | Gross Amount | 704,554 | 769,493 | | Less: Expected Credit Losses | (44,228) | (31,871) | | Total | 660,326 | 737,622 | Other Receivables and Prepayments The Group's other receivables and prepayments decreased from 113.7 million RMB as of December 31, 2024, to 91.0 million RMB as of June 30, 2025, mainly due to reduced prepayments to suppliers for intangible assets, property, plant, and equipment, and for raw materials and services - Other receivables and prepayments decreased from approximately 113.7 million RMB as of December 31, 2024, to approximately 91.0 million RMB as of June 30, 2025[76] - This was primarily due to a decrease of approximately 14.8 million RMB in prepayments to suppliers for intangible assets and property, plant, and equipment, and a decrease of approximately 6.2 million RMB in prepayments to suppliers for raw materials and services[76] Other Receivables and Prepayments Components | Component | June 30, 2025 (thousand RMB) | December 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Amounts Due from Shanghai Pharma CanSino | 71,984 | 71,984 | | Prepayments to Suppliers for Raw Materials and Services | 37,841 | 43,999 | | Input VAT to be Deducted | 25,623 | 30,212 | | Prepayments to Suppliers for Intangible Assets and Property, Plant and Equipment | 12,922 | 27,675 | | Others | 16,719 | 13,917 | | Gross Amount | 165,089 | 187,787 | | Less: Expected Credit Losses | (74,122) | (74,122) | | Net Amount | 90,967 | 113,665 | | Less: Non-current Portion | (31,004) | (57,986) | | Current Portion | 59,963 | 55,679 | Trade Payables The Group's trade payables decreased from 62.5 million RMB as of December 31, 2024, to 46.2 million RMB as of June 30, 2025, broadly consistent with reduced purchasing volumes, with no significant overdue trade payables during the reporting period - Trade payables decreased from approximately 62.5 million RMB as of December 31, 2024, to approximately 46.2 million RMB as of June 30, 2025, broadly consistent with reduced purchasing volumes[77] - As of June 30, 2025, there were no significant overdue trade payables[77] Trade Payables Ageing Analysis | Ageing | June 30, 2025 (thousand RMB) | December 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Within 1 year | 25,032 | 25,530 | | 1 to 2 years | 3,285 | 3,456 | | 2 to 3 years | 1,682 | 33,488 | | Over 3 years | 16,238 | – | | Total | 46,237 | 62,474 | Other Payables and Accruals The Group's other payables and accruals decreased by 14.6% from 632.3 million RMB as of December 31, 2024, to 540.0 million RMB as of June 30, 2025, primarily due to reduced payments for property, plant, and equipment and lower accrued salaries and benefits after 2024 bonus payments - Other payables and accruals decreased by 14.6% from approximately 632.3 million RMB as of December 31, 2024, to approximately 540.0 million RMB as of June 30, 2025[78] - This was primarily due to reduced payments for property, plant, and equipment and decreased acquisition of new property, plant, and equipment due to improved capital expenditure management and control[78] - Payment of 2024 bonuses led to a decrease in the balance of accrued salaries and benefits[78] Other Payables and Accruals Components | Component | June 30, 2025 (thousand RMB) | December 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Marketing Service Fees | 142,308 | 155,896 | | Other Amounts Payable to Property, Plant and Equipment Suppliers | 125,706 | 159,994 | | Accrued Salaries and Benefits | 94,113 | 119,110 | | Clinical Trial and Testing Fees | 78,841 | 76,176 | | Deposits from Suppliers | 13,104 | 13,934 | | Accrued Taxes Other Than Corporate Income Tax | 9,201 | 19,411 | | Other Service Fees | 9,287 | 14,255 | | Consulting Fees | 7,720 | 11,763 | | Operating and Maintenance Fees | 2,703 | 3,307 | | Consideration Received for Employees' Subscription of Restricted A Shares under 2023 Employee Shareholding Scheme | – | 6,503 | | Others | 57,028 | 51,933 | | Total | 540,011 | 632,282 | Refund Liabilities The Group's refund liabilities decreased from 75.1 million RMB as of December 31, 2024, to 40.5 million RMB as of June 30, 2025, primarily due to actual returns offsetting estimated returns - Refund liabilities decreased from approximately 75.1 million RMB as of December 31, 2024, to approximately 40.5 million RMB as of June 30, 2025[79] - The decrease was primarily due to actual returns offsetting estimated returns[79] Financial Resources, Liquidity and Capital Structure CanSino Biologics experienced a decrease in cash and cash equivalents but maintained stable liquid assets, while actively optimizing its debt structure and asset management, with future plans for a new industrial park and ongoing management of contingent liabilities and foreign exchange risks - Bank balances and cash decreased by 27.5% from approximately 1,556.5 million RMB as of December 31, 2024, to approximately 1,128.4 million RMB as of June 30, 2025, primarily due to payments for investing activities and repayment of borrowings[81] - As of June 30, 2025, current assets were approximately 4,334.8 million RMB (December 31, 2024: 4,282.5 million RMB), and current liabilities were approximately 1,758.9 million RMB (December 31, 2024: 1,772.0 million RMB)[81] - Driven by improved operating efficiency and increased sales of the core product MCV4, the Group actively optimized its debt financing structure and reduced total borrowings[82] Investments in Financial Assets The Group adopts a prudent asset management policy, investing in principal-protected structured deposits and wealth management products with returns higher than bank deposit rates, holding approximately 505.8 million RMB in structured deposits and 833.8 million RMB in wealth management products as of June 30, 2025 - The Group typically selects principal-protected structured deposits and wealth management products with returns higher than prevailing bank deposit rates and performance benchmarks, aiming to maximize capital gains[84] - As of June 30, 2025, the Group held approximately 505.8 million RMB in structured deposits and approximately 833.8 million RMB in wealth management products[84] Material Investments, Acquisitions and Disposals During the reporting period, CanSino Biologics did not undertake any material investments, acquisitions, or disposals of subsidiaries, associates, or joint ventures - During the reporting period, the company did not have any material investments, acquisitions, or disposals of subsidiaries, associates, or joint ventures[85] Future Plans for Material Investments or Capital Assets As of June 30, 2025, the Group plans to invest approximately 2,244.7 million RMB in the CanSino Innovative Vaccine Industrial Park project to enhance manufacturing capabilities, with 886.9 million RMB already invested, and no other specific material capital expenditure plans - As of June 30, 2025, approximately 2,244.7 million RMB is planned to be invested in the CanSino Innovative Vaccine Industrial Park project to strengthen manufacturing capabilities, with approximately 886.9 million RMB already invested[86] - Other than those disclosed, as of the date of this report, the Group has no specific future plans for material capital expenditures, investments, or capital assets[86] Contingent Liabilities The company received a lawsuit notice from a Brazilian court in March 2024, claiming approximately 219 million RMB in damages, but management believes the company has a strong defense and the claim is unlikely to be upheld, thus no provision has been made - The company received a lawsuit notice from a Brazilian court in March 2024, demanding compensation of approximately 219 million RMB for related losses, expenses, and moral damages incurred after the termination of the 2021 authorization to negotiate with the Brazilian government for the registration and commercialization of the company's COVID-19 vaccine in Brazil[87] - Based on current legal advice, the company has a strong defense, and Belcher's claim is unlikely to be supported by the Brazilian court; therefore, the company's management believes it is unlikely to be required to pay any economic compensation for Belcher's claim and has made no provision for this lawsuit[87] Capital Commitments As of June 30, 2025, the Group's capital commitments were approximately 37.2 million RMB, a 71.2% decrease from 129.2 million RMB as of December 31, 2024, primarily due to enhanced fixed asset management, optimized asset allocation, and improved utilization efficiency of existing assets - Capital commitments were approximately 37.2 million RMB, a 71.2% decrease from approximately 129.2 million RMB as of December 31, 2024[89] - This was primarily due to strengthened fixed asset management, optimized asset allocation in conjunction with production plans, and improved utilization efficiency of existing assets, effectively reducing future capital expenditures related to fixed asset investments[89] Pledge of Assets As of June 30, 2025, certain of the Group's property, plant, and equipment with a carrying value of approximately 154.9 million RMB were pledged as collateral for bank borrowing arrangements, with no land use rights pledged - As of June 30, 2025, certain of the Group's property, plant, and equipment with a carrying value of approximately 154.9 million RMB were pledged as collateral for the Group's bank borrowing arrangements[90] - As of June 30, 2025, and December 31, 2024, the Group had no land use rights pledged as collateral for the Group's bank borrowing arrangements[90] Exchange Rate Risk The Group is exposed to foreign exchange risk primarily from financial assets or liabilities denominated in currencies other than RMB and USD, and has entered into hedging agreements with Chinese commercial banks and implemented foreign exchange risk monitoring policies - The Group is exposed to a certain degree of foreign exchange risk, primarily due to financial assets or liabilities denominated in currencies other than its functional currency[93] - As of June 30, 2025, hedging agreements with a notional amount of 74.4 million USD (approximately 533.0 million RMB) were in effect, with a term of 12 months or less[93] Gearing Ratio As of June 30, 2025, the Group's gearing ratio was 13.18%, an increase from 8.14% as of December 31, 2024 - As of June 30, 2025, the Group's gearing ratio was 13.18% (December 31, 2024: 8.14%)[95] Other Information Compliance with Corporate Governance Code The company is committed to high corporate governance standards and generally complies with the Corporate Governance Code, with exceptions for the combined roles of Chairman and CEO and gender diversity on the Nomination Committee, aiming for full compliance by December 31, 2025 - The company has adopted the code provisions of the Corporate Governance Code as its code of corporate governance[96] - The roles of Chairman and Chief Executive Officer are not separate, both held by Dr. Yu, but the Board believes this structure does not affect the balance of power and responsibilities[96] - The company is currently seeking suitable candidates of different genders to serve as members of the Nomination Committee and expects to fully comply with code provision B.3.5 of the Corporate Governance Code on or before December 31, 2025[97] Changes in Information of Directors, Supervisors and Chief Executive During the reporting period, Independent Non-Executive Director Mr. Shuifa GUI ceased to serve as an independent non-executive director/director for Suzhou Industrial Park Lingzhi Software Co., Ltd. and Shanghai Tunnel Engineering Co., Ltd., with no other material changes to key personnel - In May 2025, Independent Non-Executive Director Mr. Shuifa GUI ceased to serve as an independent non-executive director of Suzhou Industrial Park Lingzhi Software Co., Ltd[98] - In June 2025, Independent Non-Executive Director Mr. Shuifa GUI ceased to serve as a director of Shanghai Tunnel Engineering Co., Ltd[98] Compliance with Model Code for Securities Transactions The company has adopted the Model Code for securities transactions by directors and supervisors, and all directors and supervisors confirmed compliance during the reporting period, with no non-compliance by employees identified - The company has adopted the Model Code as its code of conduct for directors and supervisors in securities transactions[99] - Following specific inquiries to all directors and supervisors, each director and supervisor confirmed their compliance with the Model Code throughout the reporting period[99] Review of Interim Financial Results The Audit Committee has reviewed the company's unaudited interim results for the six months ended June 30, 2025, confirming compliance with applicable accounting standards, laws, and regulations, and appropriate disclosures - The Audit Committee has reviewed and confirmed this results announcement[3] - The Audit Committee believes that the interim results comply with applicable accounting standards, laws, and regulations, and that the company has made appropriate disclosures[100] Scope of Work of Deloitte Touche Tohmatsu Deloitte Touche Tohmatsu, the company's independent auditor, reviewed the interim financial information in accordance with Hong Kong Standard on Review Engagements 2410 and found no matters suggesting the condensed consolidated financial statements were not prepared in all material respects according to HKAS 34 - The interim financial information has been reviewed by the company's independent auditor, Deloitte Touche Tohmatsu, in accordance with Hong Kong Standard on Review Engagements 2410 issued by the Hong Kong Institute of Certified Public Accountants[101] - The auditor found no matters that caused them to believe that the condensed consolidated financial statements were not prepared in all material respects in accordance with Hong Kong Accounting Standard 34[126] Interim Dividend The Board of Directors does not recommend the payment of an interim dividend for the reporting period - The Board of Directors does not recommend the payment of an interim dividend for the reporting period (June 30, 2024: nil)[102] Interests and Short Positions of Directors, Supervisors and Chief Executive in Shares, Underlying Shares and Debentures of the Company As of June 30, 2025, the company's directors, supervisors, and chief executive held interests in the company's shares or underlying shares, with Dr. Yu holding H and A shares, Dr. Chao holding H and A shares (including spouse's interests), and other key personnel holding smaller stakes Interests of Directors/Supervisors in Shares or Underlying Shares of the Company | Name of Director/Supervisor | Capacity/Nature of Interest | Class of Shares | Number of Shares (L) | Approximate Percentage of Total Equity of the Company | Approximate Percentage of Relevant Class of Shares | | :--- | :--- | :--- | :--- | :--- | :--- | | Dr. Yu | Beneficial owner, party to agreement regarding interests in the company | H Shares | 34,876,400 | 14.09% | 26.29% | | Dr. Yu | Beneficial owner, party to agreement regarding interests in the company | A Shares | 34,598,400 | 13.98% | 30.14% | | Dr. Chao | Beneficial owner, spouse's interest | H Shares | 11,992,700 | 4.85% | 9.04% | | Dr. Chao | Spouse's interest | A Shares | 4,409,500 | 1.78% | 3.84% | | Dr. Shao Zhongqi | Beneficial owner | H Shares | 675,000 | 0.27% | 0.51% | | Ms. Wang Jing | Beneficial owner | H Shares | 18,800 | 0.0076% | 0.0142% | | Mr. Liu Jianzhong | Beneficial owner | H Shares | 1,000 | 0.0004% | 0.0009% | | Ms. Sun Chang | Beneficial owner | A Shares | 405 | 0.0002% | 0.0004% | - Dr. Chao is deemed to have an interest in shares held by Dr. Mao and two companies controlled by Dr. Mao, CHAMPDEN LLC and Medicharms LLC[105] Interests and Short Positions of Substantial Shareholders in Shares and Underlying Shares of the Company As of June 30, 2025, Dr. Mao, Dr. Zhu, and Dr. Qiu, acting in concert, held substantial interests in both H and A shares, representing approximately 14.09% and 13.98% of the company's total equity, respectively Interests of Substantial Shareholders in Shares or Underlying Shares of the Company | Name of Substantial Shareholder | Capacity/Nature of Interest | Class of Shares | Number of Shares (L) | Approximate Percentage of Total Equity of the Company | Approximate Percentage of Relevant Class of Shares | | :--- | :--- | :--- | :--- | :--- | :--- | | Dr. Mao | Beneficial owner, party to agreement regarding interests in the company, interest in controlled corporation | H Shares | 34,876,400 | 14.09% | 26.29% | | Dr. Mao | Beneficial owner, party to agreement regarding interests in the company | A Shares | 34,598,400 | 13.98% | 30.14% | | Dr. Zhu | Party to agreement regarding interests in the company | H Shares | 34,876,400 | 14.09% | 26.29% | | Dr. Zhu | Beneficial owner, party to agreement regarding interests in the company | A Shares | 34,598,400 | 13.98% | 30.14% | | Dr. Qiu | Beneficial owner, party to agreement regarding interests in the company | H Shares | 34,876,400 | 14.09% | 26.29% | | Dr. Qiu | Beneficial owner, party to agreement regarding interests in the company | A Shares | 34,598,400 | 13.98% | 30.14% | - Dr. Mao, Dr. Zhu, Dr. Qiu, and Dr. Yu entered into an acting-in-concert agreement on February 13, 2017, committing to vote consistently on any resolutions proposed at any general meeting of the company[112] Use of Proceeds from H Share Listing and A Share Issuance The company has adjusted the use of proceeds from its H-share and A-share issuances to optimize capital efficiency and support long-term growth, with funds primarily allocated to R&D, commercialization, and the CanSino Innovative Vaccine Industrial Park project, and some A-share over-allotment proceeds used for working capital Use of Proceeds from H Share Initial Public Offering The net proceeds from the H-share IPO, approximately 1,122.3 million RMB, have been reallocated twice, primarily for R&D and commercialization of pipeline vaccines, with 178.5 million RMB remaining unutilized and expected to be fully used by the end of 2026 - The total net proceeds from the H-share initial public offering were approximately 1,309.8 million HKD, equivalent to approximately 1,122.3 million RMB[110] - The Board of Directors resolved twice, on August 21, 2020, and December 2, 2022, to change the use of proceeds from the H-share initial public offering[110] Intended and Actual Use of H-Share Proceeds (as of June 30, 2025) | Intended Use of H-Share Proceeds | Proposed Use of H-Share IPO Proceeds at Listing (million RMB) | Net Proceeds Unutilized as of June 30, 2025 (million RMB) | Expected Time for Full Utilization of Remaining Balance | | :--- | :--- | :--- | :--- | | R&D and Commercialization of Pipeline MCV | 505.1 | – | Not applicable | | R&D of Pipeline DTcP | 224.5 | – | Not applicable | | R&D of Other Key Products | 168.3 | – | Not applicable | | Continuous R&D of Preclinical Pipeline Vaccines | 112.2 | – | Not applicable | | Working Capital and Other General Corporate Purposes | 112.2 | – | Not applicable | | (i) Collaboration, Licensing, and Introduction of Advanced Technologies, Pipeline Vaccines, and Biologics; (ii) Development of Pipeline Vaccines; and (iii) Acquisition of High-Quality Assets Related to Vaccines and Biologics | – | 136.5 | Before end of 2026 | | R&D of DTcP-based Combination Vaccines | – | 42.0 | Before end of 2026 | | Total | 1122.3 | 178.5 | | Use of Proceeds from A Share Initial Public Offering The net proceeds from the A-share IPO, approximately 4,979.5 million RMB, were reallocated in April 2021, primarily for the CanSino Innovative Vaccine Industrial Park project and pipeline vaccine development, with 257.6 million RMB remaining unutilized and some over-allotment proceeds used for working capital - The net proceeds from the A-share initial public offering were approximately 4,979.5 million RMB[115] - The Board of Directors resolved on April 29, 2021, to change the use of the remaining unutilized proceeds from the A-share initial public offering[115] Intended and Actual Use of A-Share Proceeds (as of June 30, 2025) | Intended Use of A-Share IPO Proceeds | Revised Planned Use of A-Share IPO Proceeds as of May 28, 2021 (million RMB) | Net Proceeds Unutilized as of June 30, 2025 (million RMB) | Expected Time for Full Utilization of Remaining Balance | | :--- | :--- | :--- | :--- | | CanSino Innovative Vaccine Industrial Park Project | 1,100.0 | 233.6 | Before end of 2026 | | Development of Pipeline Vaccines | 150.0 | 24.0 | Before end of 2025 | | Construction of Vaccine Traceability, Cold Chain Logistics System, and Information System | 50.0 | – | Not applicable | | Working Capital | 250.0 | – | Not applicable | | Subtotal | 1,550.0 | 257.6 | Not applicable | | Over-allotment Proceeds from A-Share Issuance | 3,429.5 | – | Not applicable | | Total | 4,979.5 | 257.6 | | - The total over-allotment proceeds from the A-share issuance of 3,429.5 million RMB have been used to permanently supplement working capital[118] Purchases, Sales or Redemptions of the Company's Listed Securities The company repurchased 683,748 A shares for approximately 150.2 million RMB in 2022, with 277,650 shares used for the 2023 shareholding plan, and no other listed securities were purchased, sold, or redeemed during the reporting period - The company repurchased 683,748 A shares in 2022, for a total consideration of approximately 150.2 million RMB[120] - As of June 30, 2025, 277,650 A shares repurchased were used for the 2023 shareholding plan[120] - During the reporting period, neither the company nor any of its subsidiaries purchased, sold, or redeemed any other shares (including any sales or transfers of treasury shares)[121] Rights of Directors and Supervisors to Acquire Shares or Debentures During the reporting period, no directors, supervisors, or their associates were granted or exercised any rights to acquire shares or debentures of the company or its subsidiaries - During the reporting period, no directors, supervisors, or any of their respective associates were granted any rights to acquire shares or debentures of the company or its subsidiaries, nor did they exercise any such rights[122] Material Events After the Reporting Period No other material events occurred after the reporting period up to the date of this report, except as otherwise disclosed herein - Except as otherwise disclosed in this report, no other material events occurred after the reporting period up to the date of this report[123] Independent Auditor's Report Scope of Review and Conclusion Deloitte Touche Tohmatsu, the independent auditor, reviewed CanSino Biologics' condensed consolidated financial statements in accordance with HKSRS 2410 and found no matters indicating non-compliance with HKAS 34 in all material respects - The auditor conducted the review in accordance with Hong Kong Standard on Review Engagements 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Hong Kong Institute of Certified Public Accountants[125] - Based on the review, the auditor found no matters that caused them to believe that the condensed consolidated financial statements were not prepared in all material respects in accordance with Hong Kong Accounting Standard 34[126] Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income Profit or Loss Statement Overview For the six months ended June 30, 2025, CanSino Biologics reported revenue of 374.1 million RMB, gross profit of 296.6 million RMB, and a significantly narrowed loss for the period of 13.5 million RMB, with basic and diluted loss per share of 0.05 RMB Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (for the six months ended June 30) | Indicator | 2025 (thousand RMB) | 2024 (thousand RMB) | | :--- | :--- | :--- | | Revenue | 374,088 | 285,420 | | Cost of Goods Sold | (77,508) | (98,269) | | Gross Profit | 296,580 | 187,151 | | Other Income | 94,405 | 54,127 | | Selling Expenses | (156,343) | (112,478) | | Administrative Expenses | (77,757) | (87,775) | | Research and Development Expenses | (147,794) | (185,902) | | Impairment Loss under Expected Credit Loss Model | (12,357) | (14,061) | | Other Gains (Losses), Net | 2,002 | (75,329) | | Share of Results of Associates | (944) | (16,199) | | Operating Loss | (2,208) | (250,466) | | Finance Income or Gains | 17,326 | 54,092 | | Finance Costs | (34,421) | (32,822) | | Finance (Expenses or Losses) Income or Gains – Net | (17,095) | 21,270 | | Loss Before Income Tax | (19,303) | (229,196) | | Income Tax Credit (Expense) | 5,818 | (964) | | Loss for the Period | (13,485) | (230,160) | | Total Comprehensive Expenses for the Period | (13,527) | (229,666) | | Loss for the Period Attributable to Owners of the Company | (13,485) | (225,373) | | Loss for the Period Attributable to Non-controlling Interests | – | (4,787) | | Loss Per Share – Basic and Diluted (in RMB) | (0.05) | (0.91) | Condensed Consolidated Statement of Financial Position Assets, Equity and Liabilities Overview As of June 30, 2025, CanSino Biologics' total assets were 7,705.0 million RMB, with total equity at 4,903.4 million RMB and total liabilities at 2,801.6 million RMB Condensed Consolidated Statement of Financial Position (as of June 30) | Indicator | June 30, 2025 (thousand RMB) | December 31, 2024 (thousand RMB) | | :--- | :--- | :--- | | Assets | | | | Total Non-current Assets | 3,370,189 | 3,675,641 | | Total Current Assets | 4,334,839 | 4,282,491 | | Total Assets | 7,705,028 | 7,958,132 | | Equity | | | | Equity Attributable to Owners of the Company | 4,903,405 | 4,909,872 | | Non-controlling Interests | – | – | | Total Equity | 4,903,405 | 4,909,872 | | Liabilities | | | | Total Non-current Liabilities | 1,042,716 | 1,276,218 | | Total Current Liabilities | 1,758,907 | 1,772,042 | | Total Liabilities | 2,801,623 | 3,048,260 | | Total Equity and Liabilities | 7,705,028 | 7,958,132 | Condensed Consolidated Statement of Changes in Equity Equity Changes Overview For the six months ended June 30, 2025, equity attributable to owners slightly decreased from 4,909.9 million RMB to 4,903.4 million RMB, primarily due to the loss for the period and other comprehensive loss, partially offset by share-based payment transfers and restricted share sales Condensed Consolidated Statement of Changes in Equity (for the six months ended June 30) | Indicator | Balance as of January 1, 2025 (thousand RMB) | Total Comprehensive Expenses for the Period (thousand RMB) | Equity-settled Share-based Payments Recognized (thousand RMB) | Transfer upon Vesting of Share-based Payments (thousand RMB) | Impact of Sale of Restricted Shares Granted under 2023 Shareholding Scheme (thousand RMB) | Balance as of June 30, 2025 (thousand RMB) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Share Capital | 247,450 | – | – | – | – | 247,450 | | Share Premium | 6,599,238 | – | – | 4,130 | – | 6,603,368 | | Treasury Shares | (95,622) | – | – | 6,406 | 99 | (89,117) | | Capital Reserve | (22,509) | – | 555 | (4,130) | – | (26,084) | | Statutory Reserve | 118,389 | – | – | – | – | 118,389 | | Translation Reserve | 224 | (42) | – | – | – | 182 | | Accumulated Losses | (1,937,298) | (13,485) | – | – | – | (1,950,783) | | Subtotal of Equity Attributable to Owners of the Company | 4,909,872 | (13,527) | 555 | 6,406 | 99 | 4,903,405 | | Non-controlling Interests | – | – | – | – | – | – | | Total | 4,909,872 | (13,527) | 555 | 6,406 | 99 | 4,903,405 | Condensed Consolidated Statement of Cash Flows Cash Flow Overview For the six months ended June 30, 2025, CanSino Biologics generated 3.4 million RMB net cash from operating activities, used 278.0 million RMB in investing activities, and 146.5 million RMB in financing activities, resulting in a net decrease of 421.1 million RMB in cash and cash equivalents Condensed Consolidated Statement of Cash Flows (for the six months ended June 30) | Indicator | 2025 (thousand RMB) | 2024 (thousand RMB) | | :--- | :--- | :--- | | Net Cash From (Used In) Operating Activities | 3,424 | (226,131) | | Net Cash (Used In) From Investing Activities | (278,041) | 2,210 | | Net Cash Used In Financing Activities | (146,528) | (113,307) | | Net Decrease in Cash and Cash Equivalents | (421,145) | (337,228) | | Cash and Cash Equivalents at Beginning of Period | 1,555,805 | 2,046,099 | | Effect of Exchange Rate Changes | (6,674) | 12,385 | | Cash and Cash Equivalents at End of Period | 1,127,986 | 1,721,256 | Notes to the Condensed Consolidated Financial Statements 1. General Information CanSino Biologics, established in Tianjin, China on January 13, 2009, focuses on human vaccine R&D, manufacturing, and commercialization, with H-shares listed on HKEX in 2019 and A-shares on SSE STAR Market in 2020 - CanSino Biologics was incorporated in Tianjin, China on January 13, 2009, and is principally engaged in the research, development, manufacturing, and commercialization of human vaccine products[135] - The company's H shares were listed on the Main Board of the Stock Exchange of Hong Kong on March 28, 2019, and its A shares were listed on the STAR Market of the Shanghai Stock Exchange on August 13, 2020[136] 2. Basis of Preparation The condensed consolidated financial statements are prepared in accordance with HKAS 34 "Interim Financial Reporting" issued by the HKICPA and applicable disclosure requirements of the HKEX Listing Rules - The condensed consolidated financial statements are prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants and the applicable disclosure requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[138] 3. Principal Accounting Policies The condensed consolidated financial statements are prepared on a historical cost basis, with certain financial instruments measured at fair value, and the first-time application of HKAS 21 amendments "Lack of Exchangeability" had no material impact - The condensed consolidated financial statements are prepared on a historical cost basis, except for certain financial instruments that are measured at fair value[139] - During the current interim period, the Group has first applied the amendments to Hong Kong Financial Reporting Standards issued by the HKICPA that are mandatorily effective for the Group's annual period beginning on January 1, 2025, including amendments to HKAS 21 "Lack of Exchangeability"[140] - The application of the amendments to Hong Kong Financial Reporting Standards has had no material impact on the Group's financial position and performance for the current and prior periods and/or on the disclosures set out in these condensed consolidated financial statements[140] 4. Critical Accounting Judgements and Key Sources of Estimation Uncertainty Management makes judgments, estimates, and assumptions affecting reported amounts of assets, liabilities, income, and expenses when preparing the condensed consolidated financial statements, with actual results potentially differing, and key uncertainties remain consistent with the 2024 annual consolidated financial statements - In preparing the condensed consolidated financial statements, management is required to make judgments, estimates, and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income, and expenses[141] - The critical judgments made by management in applying the Group's accounting policies and the key sources of estimation uncertainty in preparing these condensed consolidated financial statements were the same as those applied to the consolidated financial statements for the year ended December 31, 2024[141] 5. Revenue For the six months ended June 30, 2025, the Group's revenue was 374.1 million RMB, primarily from vaccine product sales, recognized when control transfers, with contract liabilities mainly representing unfulfilled vaccine sales Revenue Details (for the six months ended June 30) | Revenue Source | 2025 (thousand RMB) | 2024 (thousand RMB) | | :--- | :--- | :--- | | Sales of Vaccine Products at a Point in Time | 374,088 | 262,812 | | Provision of Development and Manufacturing Services at a Point in Time | – | 22,608 | | Total | 374,088 | 285,420 | - Revenue from the sale of vaccine products is recognized when control of the vaccine and related products is transferred, which is when the goods are shipped to a specific location and accepted by the customer[142] - As of June 30, 2025, contract liabilities recognized were 45,038 thousand RMB (December 31, 2024: 14,687 thousand RMB), primarily for unfulfilled sales of vaccine and related products and provision of development and manufacturing services, as well as research and technical services[146] 6. Segment Information The Group operates as a single segment focused on human vaccine R&D, manufacturing, and commercialization, with revenue and non-current assets primarily derived fr