星空华文(06698) - 2025 - 中期业绩

Company Information and Financial Highlights Company Overview This report presents Star CM Holdings Limited's unaudited interim results announcement for the six months ended June 30, 2025, reviewed by the Board's audit committee - This announcement is the unaudited interim results report of Star CM Holdings Limited for the six months ended June 30, 2025[2][3] Financial Performance Summary For the six months ended June 30, 2025, the company's revenue decreased by 17.0% year-on-year, while gross profit significantly increased by 233.3%, and both loss before tax and loss for the period substantially narrowed As at 30 June 2025 Key Financial Indicators | Item | 2025 (RMB million) | 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 59.0 | 71.1 | (17.0%) | | Gross Profit | 22.0 | 6.6 | 233.3% | | Loss Before Tax | (10.4) | (55.3) | (81.2%) | | Loss for the Period | (11.1) | (56.0) | (80.2%) | Condensed Consolidated Statement of Profit or Loss During the reporting period, the company's revenue was RMB 59,035 thousand, with a substantial decrease in cost of sales leading to a significant increase in gross profit to RMB 21,970 thousand; despite increased losses from associates, a significant reduction in administrative expenses and fair value gains on financial assets narrowed the loss for the period to RMB 11,149 thousand Unaudited Condensed Interim Consolidated Statement of Profit or Loss (For the six months ended 30 June) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Revenue | 59,035 | 71,113 | | Cost of Sales | (37,065) | (64,521) | | Gross Profit | 21,970 | 6,592 | | Other Income and Gains | 8,373 | 8,270 | | Selling and Distribution Expenses | (8,338) | (7,817) | | Administrative Expenses | (21,705) | (42,504) | | Net Reversal of Impairment Loss on Trade Receivables | 1,403 | 3,572 | | (Impairment Loss) / Reversal of Impairment Loss on Other Receivables | (259) | 634 | | Reversal of Impairment Loss on Loans to a Joint Venture and an Associate | 1,838 | – | | Other Expenses | (2,651) | (387) | | Fair Value Changes of Financial Assets at Fair Value Through Profit or Loss | 12,878 | (5,594) | | Finance Costs | (113) | (221) | | Share of Loss of Joint Ventures | (8,478) | (14,873) | | Share of Loss of Associates | (15,316) | (3,012) | | Loss Before Tax | (10,398) | (55,340) | | Income Tax Expense | (751) | (635) | | Loss for the Period | (11,149) | (55,975) | | Loss Per Share Attributable to Ordinary Equity Holders of the Parent (Basic and Diluted) | (0.03) | (0.14) | Condensed Consolidated Statement of Comprehensive Income For the six months ended June 30, 2025, the company's total comprehensive loss for the period significantly narrowed to RMB 12,530 thousand from RMB 53,399 thousand in the prior year, primarily due to reduced loss for the period, despite exchange differences turning from gain to loss Unaudited Condensed Interim Consolidated Statement of Comprehensive Income (For the six months ended 30 June) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Loss for the Period | (11,149) | (55,975) | | Exchange Differences Arising from Translation of Foreign Operations | (1,381) | 2,576 | | Total Comprehensive Loss for the Period | (12,530) | (53,399) | Condensed Consolidated Statement of Financial Position As of June 30, 2025, the company's total assets less current liabilities were RMB 2,660,553 thousand, a slight decrease from year-end 2024, with a minor reduction in total non-current assets and an increase in net current assets Unaudited Condensed Interim Consolidated Statement of Financial Position (As at 30 June 2025) | Item | As at 30 June 2025 (RMB thousand) | As at 31 December 2024 (RMB thousand) | | :--- | :--- | :--- | | NON-CURRENT ASSETS | | | | Total non-current assets | 2,132,442 | 2,187,533 | | CURRENT ASSETS | | | | Total current assets | 700,164 | 711,323 | | CURRENT LIABILITIES | | | | Total current liabilities | 172,053 | 225,800 | | Net current assets | 528,111 | 485,523 | | Total assets less current liabilities | 2,660,553 | 2,673,056 | | NON-CURRENT LIABILITIES | | | | Total non-current liabilities | 25,254 | 25,408 | | Net assets | 2,635,299 | 2,647,648 | | Total equity | 2,635,299 | 2,647,648 | Notes to the Condensed Interim Consolidated Financial Information Company and Group Information The company, incorporated in the Cayman Islands and listed on the Hong Kong Stock Exchange in December 2022, primarily engages in the production, operation, and licensing of variety show, music, drama series, and film IPs, along with other IP-related businesses, with CMC Inc. as the ultimate controlling shareholder - The company was incorporated in the Cayman Islands on March 29, 2021, and listed on the Main Board of the Hong Kong Stock Exchange on December 29, 2022[9][10] - The company's business primarily covers the production, operation, and licensing of variety show IP, music IP, drama series and film IP, as well as other IP-related businesses[10] Basis of Preparation and Changes in Accounting Policies The interim financial statements are prepared in accordance with HKEX Listing Rules, IFRS, and IAS 34, consistent with annual financial statements, with no material impact from the first-time application of IAS 21 (Revised) this period - The financial statements are prepared in accordance with the HKEX Listing Rules, International Financial Reporting Standards, and International Accounting Standard 34 'Interim Financial Reporting'[11] - This period marks the first application of IAS 21 (Revised) 'Lack of Exchangeability', with no material impact on financial position or performance[12] Operating Segment and Geographical Information The company's management considers the Group as a single reportable operating segment, with revenue primarily from Mainland China but increasing from other regions, and non-current assets mainly concentrated in Mainland China and Hong Kong - Management considers the Group as a single reportable operating segment[13] Regional Revenue Distribution (For the six months ended 30 June) | Region | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Mainland China | 36,788 | 54,674 | | Other Regions | 22,247 | 16,439 | | Total | 59,035 | 71,113 | Regional Non-current Assets Distribution (As at 30 June 2025) | Region | As at 30 June 2025 (RMB thousand) | As at 31 December 2024 (RMB thousand) | | :--- | :--- | :--- | | Mainland China | 1,635,118 | 1,610,638 | | Hong Kong | 367,542 | 422,081 | | Total | 2,002,660 | 2,032,719 | Revenue Analysis Total revenue for the reporting period was RMB 59,035 thousand, a year-on-year decrease, with significant growth in drama series and film IP operation and licensing revenue, while variety show IP, music IP, and other IP-related business revenues all declined Revenue by Type of Goods or Services (For the six months ended 30 June) | Type of Goods or Services | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Variety Show IP Production, Operation and Licensing | 13,557 | 25,453 | | Music IP Operation and Licensing | 6,444 | 7,566 | | Drama Series and Film IP Operation and Licensing | 25,434 | 16,393 | | Other IP-related Businesses | 13,600 | 21,701 | | Total Revenue from Contracts with Customers | 59,035 | 71,113 | Timing of Revenue Recognition (For the six months ended 30 June) | Timing of Revenue Recognition | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | At a point in time | 28,751 | 41,805 | | Over time | 30,284 | 29,308 | Loss Before Tax and Income Tax Loss before tax significantly narrowed, primarily due to a substantial decrease in variety show IP costs and reversal of impairment losses; income tax expense remained relatively stable, mainly comprising tax rates from Mainland China, Hong Kong, and Macau, with Shanghai Canxing Culture Media Co., Ltd. benefiting from a high-tech enterprise preferential tax rate Components of Loss Before Tax (For the six months ended 30 June) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Variety Show IP Production, Operation and Licensing Cost | 10,422 | 35,934 | | Drama Series and Film IP Operation and Licensing Cost | 10,162 | 6,211 | | Net Reversal of Impairment Loss on Trade Receivables | (1,403) | (3,572) | | Reversal of Impairment Loss on Loans to a Joint Venture and an Associate | (1,838) | – | - Shanghai Canxing Culture Media Co., Ltd., as a high-tech enterprise, enjoys a preferential income tax rate of 15%, valid until December 12, 2026[21] Major Components of Income Tax Expense (For the six months ended 30 June) | Item | 2025 (RMB thousand) | 2024 (RMB thousand) | | :--- | :--- | :--- | | Current - Expense for the period | 72 | 611 | | Over-provision in prior years | 2,809 | – | | Deferred tax | (2,130) | 24 | | Income Tax Expense | 751 | 635 | Dividends and Loss Per Share The Board did not declare any interim dividend for the six months ended June 30, 2025, and basic and diluted loss per share significantly narrowed to RMB 0.03 from RMB 0.14 in the prior year - The Board did not declare any interim dividend for the six months ended June 30, 2025[23] Loss Per Share (For the six months ended 30 June) | Item | 2025 (RMB) | 2024 (RMB) | | :--- | :--- | :--- | | Loss Per Share Attributable to Ordinary Equity Holders of the Parent (Basic and Diluted) | (0.03) | (0.14) | Trade Receivables and Trade Payables Total trade receivables amounted to RMB 68,994 thousand, a 30.3% decrease from year-end 2024, primarily due to reduced revenue; total trade payables were RMB 101,935 thousand, a 13.0% decrease from year-end 2024, consistent with the reduction in cost of sales Trade Receivables (As at 30 June 2025) | Item | As at 30 June 2025 (RMB thousand) | As at 31 December 2024 (RMB thousand) | | :--- | :--- | :--- | | Trade Receivables | 399,124 | 434,344 | | Less: Impairment Loss | (330,130) | (335,387) | | Total | 68,994 | 98,957 | - Trade receivables typically have a credit period of 30 days and are subject to maximum credit limits[25] Trade Payables (As at 30 June 2025) | Ageing | As at 30 June 2025 (RMB thousand) | As at 31 December 2024 (RMB thousand) | | :--- | :--- | :--- | | Within 1 year | 18,158 | 47,663 | | 1 to 2 years | 17,624 | 45,191 | | 2 to 3 years | 43,354 | 14,180 | | Over 3 years | 22,799 | 10,083 | | Total | 101,935 | 117,117 | - Trade payables are non-interest bearing and usually settled on credit terms of 90 to 180 days[27] Provisions and Commitments As of June 30, 2025, total provisions significantly decreased by 81.4% to RMB 6,623 thousand, mainly due to the payment of litigation provisions; the Group's contractual commitments primarily relate to leased land and construction in progress, totaling RMB 800,431 thousand Movement in Provisions (For the six months ended 30 June 2025) | Item | As at 1 January 2025 (RMB thousand) | Additional provisions made (RMB thousand) | Provisions utilised (RMB thousand) | As at 30 June 2025 (RMB thousand) | | :--- | :--- | :--- | :--- | :--- | | MBC - 'Masked Singer 2016' | 24,371 | – | (24,371) | – | | Entity A | 1,435 | – | – | 1,435 | | Entity B | 4,257 | – | (4,257) | – | | Entity C | 4,165 | – | – | 4,165 | | Others | 1,195 | – | (172) | 1,023 | | Total | 35,423 | – | (28,800) | 6,623 | Contractual Commitments (As at 30 June 2025) | Item | As at 30 June 2025 (RMB thousand) | As at 31 December 2024 (RMB thousand) | | :--- | :--- | :--- | | Leased land and construction in progress | 800,431 | 799,903 | Management Discussion and Analysis Business Review and Prospects The company is dedicated to IP creation, operation, and licensing across variety shows, music, drama series, and films, aiming to enhance IP creation capabilities, expand audience reach, accelerate business expansion through M&A, and continuously attract and build talent teams - The company actively participated in directing and post-production services for variety shows such as 'The Most Beautiful Central Axis', 'Asia New Voice', and 'Speed Racer'[30] - The company, in collaboration with iQIYI and Hainan Happy Time Film Co., Ltd., launched the '100 Hong Kong Film Micro-Drama Project', selecting 100 classic Hong Kong film IPs for in-depth micro-drama adaptation[30] - Future development initiatives include strengthening IP creation and operation capabilities (e.g., micro-drama secondary creation), expanding audience reach and brand influence (e.g., overseas market expansion), growing business through M&A, and continuously attracting and building talent teams[36][37] Variety Show IP Production, Operation and Licensing During the reporting period, the company participated in the production of variety shows like 'The Most Beautiful Central Axis', 'Asia New Voice', and 'Speed Racer', and collaborated with iQIYI on a '100 Hong Kong Film Micro-Drama Project', though this business's financial performance is subject to various fluctuating factors - Participated in directing and post-production for variety shows such as 'The Most Beautiful Central Axis', 'Asia New Voice', and 'Speed Racer'[30] - Launched the '100 Hong Kong Film Micro-Drama Project', selecting 100 classic Hong Kong film IPs for in-depth micro-drama adaptation[30] - Revenue, gross profit, and gross profit margin of the variety show IP business are influenced by various factors such as cooperation models, negotiations with investing media platforms, economic environment, and audience preferences, leading to potential fluctuations in financial performance[31] Music IP Operation and Licensing As of June 30, 2025, the company's music library holds 9,835 IPs, comprising live music recordings, songs by contracted artists, and lyrical music works - As of June 30, 2025, the company's music library holds 9,835 IPs, including 3,765 live music recordings, 3,754 songs by contracted artists, and 2,316 lyrical and musical works[32] Film and Drama Series IP Operation and Licensing As of June 30, 2025, the company owns 757 Chinese film IPs and one drama series 'Reading Class', primarily generating fixed licensing fees by authorizing the re-broadcast of film IPs to domestic and international TV and online video platforms - As of June 30, 2025, the company owns 757 Chinese film IPs and one drama series, 'Reading Class'[33] - Fixed licensing fees are primarily generated by authorizing the re-broadcast of film IPs to domestic and international television media platforms and online video platforms[34] Other IP-related Businesses Other IP-related businesses include artist management, concert organization and production, art education and training, mobile applications, derivative consumer products, and live experience venues, with 69 contracted artists as of June 30, 2025 - Other IP-related businesses include artist management, concert organization and production, art education and training, mobile applications, derivative consumer products, and live experience venues[35] - As of June 30, 2025, the company has 69 contracted artists[35] Prospects and Future Development The company is committed to strengthening IP creation and operation capabilities (including micro-drama secondary creation), expanding audience reach and brand influence (including overseas market expansion), integrating quality industry resources through M&A, and continuously attracting and building talent teams to adapt to market demands and accelerate business expansion - The company will continue to operate its music and film IP libraries, enhance content production capabilities, enrich IP types and themes, and actively engage in micro-drama secondary creation to revitalize old film IP value[37] - Plans include expanding audience reach and brand influence by increasing cooperation platforms, offering live experiences, and boosting overseas market investment[37] - The company will closely monitor and evaluate high-quality M&A targets that complement its business and align with its strategy to integrate upstream and downstream resources in the entertainment market value chain[37] - Plans involve attracting top talent in IP production, operation, and management by improving talent acquisition and retention systems[37] Financial Review During the reporting period, the company's revenue decreased, but gross profit significantly increased, and net loss substantially narrowed; this was primarily due to the variety show IP production business turning to gross profit and reduced administrative expenses, with film and drama series IP business revenue and gross profit growing, while other IP businesses declined - For the six months ended June 30, 2025, the company reported revenue RMB 59.0 million, gross profit RMB 22.0 million, and a net loss RMB 11.1 million, a significant reduction from RMB 56.0 million in the prior year[38] - The reduction in net loss is primarily attributable to the variety show IP production, operation, and licensing business turning to gross profit, and a significant decrease in administrative expenses[38] Overview For the six months ended June 30, 2025, the company reported revenue of RMB 59.0 million, gross profit of RMB 22.0 million, and a net loss of RMB 11.1 million, a significant 80.2% reduction from RMB 56.0 million in the prior year Financial Overview (For the six months ended 30 June) | Item | 2025 (RMB million) | 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Revenue | 59.0 | 71.1 | (17.0%) | | Gross Profit | 22.0 | 6.6 | 233.3% | | Net Loss | (11.1) | (56.0) | (80.2%) | - The reduction in net loss is primarily attributable to the variety show IP production, operation, and licensing business turning to gross profit, and a significant decrease in administrative expenses[38] Revenue by Business Segment During the reporting period, revenue from variety show IP, music IP, and other IP-related businesses decreased, while film and drama series IP operation and licensing revenue significantly grew by 54.9%, becoming a key growth driver Revenue by Business Segment (For the six months ended 30 June) | Business Segment | 2025 (RMB million) | 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Variety Show IP Production, Operation and Licensing | 13.6 | 25.5 | (46.7%) | | Music IP Operation and Licensing | 6.4 | 7.6 | (15.8%) | | Film and Drama Series IP Operation and Licensing | 25.4 | 16.4 | 54.9% | | Other IP-related Businesses | 13.6 | 21.6 | (37.0%) | | Total | 59.0 | 71.1 | (17.0%) | - Variety show IP revenue decreased by 46.7%, mainly due to a reduction in the scale of variety shows[40] - Film and drama series IP revenue increased by 54.9%, primarily due to higher film IP licensing revenue[42] - Other IP-related business revenue decreased by 37.0%, mainly due to a decline in commercial performance revenue resulting from fewer contracted artists[43] Cost of Sales Total cost of sales decreased by 42.6% from RMB 64.5 million in the prior year to RMB 37.0 million in 2025; variety show IP production costs significantly dropped by 71.0%, consistent with revenue decline, while film and drama series IP costs increased with revenue growth Cost of Sales by Business Segment (For the six months ended 30 June) | Business Segment | 2025 (RMB million) | 2024 (RMB million) | Change (%) | | :--- | :--- | :--- | :--- | | Variety Show IP Production, Operation and Licensing | 10.4 | 35.9 | (71.0%) | | Music IP Operation and Licensing | 3.4 | 3.7 | (8.1%) | | Film and Drama Series IP Operation and Licensing | 10.2 | 6.2 | 64.5% | | Other IP-related Businesses | 13.0 | 18.7 | (30.5%) | | Total | 37.0 | 64.5 | (42.6%) | - Cost of sales for variety show IP production, operation, and licensing decreased by 71.0%, consistent with the revenue decline due to reduced variety show scale[45] - Cost of sales for film and drama series IP operation and licensing increased by 64.5%, consistent with the revenue growth in this business segment[47] Gross Profit (Loss) and Gross Profit (Loss) Margin During the reporting period, the company's total gross profit significantly increased by 233.3% to RMB 22.0 million, with gross profit margin rising to 37.3%; variety show IP business turned from gross loss to gross profit with a 23.5% margin, mainly due to a shift towards director teams and post-production, while film and drama series IP gross profit grew by 49.0% but its margin slightly decreased Gross Profit and Gross Profit Margin by Business Segment (For the six months ended 30 June) | Business Segment | 2025 Gross Profit (RMB million) | 2025 Gross Profit Margin (%) | 2024 Gross Profit (RMB million) | 2024 Gross Profit Margin (%) | | :--- | :--- | :--- | :--- | :--- | | Variety Show IP Production, Operation and Licensing | 3.2 | 23.5% | (10.4) | (40.8%) | | Music IP Operation and Licensing | 3.0 | 46.9% | 3.9 | 51.3% | | Film and Drama Series IP Operation and Licensing | 15.2 | 59.8% | 10.2 | 62.2% | | Other IP-related Businesses | 0.6 | 4.4% | 2.9 | 13.4% | | Total | 22.0 | 37.3% | 6.6 | 9.3% | - The variety show IP production, operation, and licensing business turned from a gross loss of RMB 10.4 million in the prior year to a gross profit of RMB 3.2 million, with a gross profit margin of 23.5%, mainly due to a shift in focus to director teams and post-production[52] - Gross profit from film and drama series IP operation and licensing increased by 49.0% to RMB 15.2 million, consistent with revenue growth, but the gross profit margin slightly decreased to 59.8%[54] Other Income and Expenses Other income and gains remained stable; administrative expenses significantly decreased by 48.9%, primarily due to reduced professional service fees, depreciation, and R&D expenses; fair value changes of financial assets turned from loss to gain, while other expenses notably increased due to higher late payment fees and exchange losses - Other income and gains remained relatively stable at RMB 8.3 million (2024) and RMB 8.4 million (2025) respectively[56] - Administrative expenses decreased by 48.9% to RMB 21.7 million, primarily due to reduced professional service fees, depreciation of right-of-use assets and property, plant and equipment, and R&D expenses[58] - Fair value changes of financial assets at fair value through profit or loss turned from a loss of RMB 5.6 million to a gain of RMB 12.9 million, mainly influenced by fluctuations in listed company share prices[60] - Other expenses increased by 575.0% to RMB 2.7 million, primarily due to higher late payment fees and exchange losses[61] Share of Profits and Losses of Joint Ventures and Associates During the reporting period, share of loss of joint ventures decreased, mainly due to reduced operating losses from Mengxiang Qian; however, share of loss of associates increased, primarily due to higher operating losses from Shaanxi Shuolan and Shaanxi Yuanlv - Share of loss of joint ventures decreased from RMB 14.9 million to RMB 8.5 million, mainly due to reduced operating losses from Mengxiang Qian[63] - Share of loss of associates increased from RMB 3.0 million to RMB 15.3 million, primarily due to higher operating losses from Shaanxi Shuolan and Shaanxi Yuanlv[63] Loss for the Period Considering the aforementioned factors, the company's net loss for the period significantly narrowed to RMB 11.1 million, compared to RMB 56.0 million in the prior year - For the six months ended June 30, 2025, the company's net loss was RMB 11.1 million, a significant reduction from RMB 56.0 million in the prior year[65] Financial Position As of June 30, 2025, the company's financial position remained relatively stable; interests in associates within non-current assets slightly decreased, while cash and cash equivalents in current assets increased; on the liabilities side, both trade receivables and payables decreased, provisions significantly declined, and contract liabilities increased - Items such as property, plant and equipment, goodwill, programme copyrights, prepayments, other receivables and other assets, and lease liabilities remained relatively stable[66][67][79][81][86] Non-current Assets Interests in associates slightly decreased by 1.9% to RMB 849.4 million, primarily due to increased operating losses from associates; interests in joint ventures remained stable; other intangible assets decreased due to amortization of film IP licenses; financial assets at fair value through profit or loss increased by 24.4%, mainly influenced by listed company share price fluctuations Goodwill Carrying Amount (As at 30 June 2025) | Cash-generating unit | As at 30 June 2025 (RMB million) | As at 31 December 2024 (RMB million) | | :--- | :--- | :--- | | Starry Dream Culture Communication (Shanghai) Co., Ltd. CGU | 24.0 | 24.0 | | Star CM Media Film Co., Ltd. CGU | 231.6 | 232.6 | | Total | 255.6 | 256.6 | - Interests in associates decreased by 1.9% to RMB 849.4 million, primarily due to increased operating losses from associates[69] - Other intangible assets decreased by 4.1% to RMB 125.9 million, mainly due to normal amortization of film IP licenses[76] - Financial assets at fair value through profit or loss increased by 24.4% to RMB 65.3 million, primarily due to fluctuations in the share prices of listed investments[77] Current Assets Cash and cash equivalents increased to RMB 532.9 million; amounts due from related parties significantly decreased by 76.3%, primarily due to partial loan repayments; restricted deposits decreased by 58.4%, primarily due to the resolution of certain litigation cases; trade receivables decreased by 30.3%, consistent with the reduction in revenue - Cash and cash equivalents increased to RMB 532.9 million (December 31, 2024: RMB 425.3 million)[87] - Amounts due from related parties decreased by 76.3% to RMB 26.7 million, mainly due to partial loan repayments by Mengxiang Qian and CMC Asia Group Holdings Ltd[75] - Restricted deposits decreased by 58.4% to RMB 28.5 million, primarily due to the resolution of certain litigation cases and the release of prior provisions[78] - Trade receivables decreased by 30.3% to RMB 69.0 million, consistent with the change in revenue[80] Liabilities Trade payables decreased by 13.0%, consistent with the reduction in cost of sales; other payables and accrued charges decreased by 23.9%, mainly due to settlements; contract liabilities increased by 21.3%, primarily due to an increase in unrecognised contract liabilities; provisions significantly decreased by 81.4%, primarily due to the payment of litigation provisions - Trade payables decreased by 13.0% to RMB 101.9 million, consistent with the change in cost of sales[82] - Other payables and accrued charges decreased by 23.9% to RMB 35.4 million, mainly due to the settlement of certain other payables[83] - Contract liabilities increased by 21.3% to RMB 19.4 million, primarily due to an increase in unrecognised contract liabilities[84] - Provisions decreased by 81.4% to RMB 6.6 million, primarily due to the payment of litigation provisions[85] Liquidity and Capital Resources The company primarily meets its cash needs through equity financing and cash flows generated from retained earnings; as of June 30, 2025, cash and cash equivalents were RMB 532.9 million, and the gearing ratio remained stable at 0.25% - As of June 30, 2025, cash and cash equivalents were RMB 532.9 million (December 31, 2024: RMB 425.3 million)[87] - The company primarily funds its cash requirements through equity financing and cash flows generated from retained earnings[87] - As of June 30, 2025, the gearing ratio was 0.25%, remaining stable compared to 0.26% as of December 31, 2024[88] Other Financial Information No material acquisitions or disposals occurred during the reporting period; pledged assets primarily consist of restricted deposits for leased land and litigation; the company faces transactional currency risk but currently does not intend to hedge; there are no future plans for material investments beyond those disclosed in the prospectus - No material acquisitions or disposals of subsidiaries, consolidated affiliated entities, or associates occurred during the reporting period[89] - As of June 30, 2025, pledged time deposits amounted to RMB 28.5 million, used as collateral for leased land purchases and litigation[90] - The company faces transactional currency risk, primarily from cash and cash equivalents denominated in HKD or USD, and currently does not intend to hedge[92] - Other than the intended use of proceeds disclosed in the prospectus, the company has no other material investment or capital asset plans[93] Corporate Governance and Other Information Employees and Remuneration Policy As of June 30, 2025, the Group had 116 employees, with total staff remuneration expenses of RMB 19.8 million for the first half; remuneration policy is based on industry practice, employee performance, and market levels, offering benefits such as year-end bonuses, allowances, and retirement schemes - As of June 30, 2025, the Group had 116 employees[94] - Total staff remuneration expenses for the first half of 2025 amounted to RMB 19.8 million[94] - Remuneration policy is determined based on industry practice, employee educational background, experience, and performance, offering various benefits[94] Material Litigation For the six months ended June 30, 2025, the company was not involved in any material litigation or arbitration - For the six months ended June 30, 2025, the company was not involved in any material litigation or arbitration[95] Events After the Reporting Period As of the date of this announcement, no significant events affecting the Group have occurred since the end of the reporting period - As of the date of this announcement, no significant events that could affect the Group have occurred since the six months ended June 30, 2025[96] Corporate Governance The Board is committed to high standards of corporate governance and has adopted the Corporate Governance Code; the company deviates from Code Provision C.2.1 regarding the separation of Chairman and Chief Executive roles, with Mr. Tian Ming holding both, which the Board believes benefits business management and leadership unity; otherwise, the company has complied with the Corporate Governance Code - The company has adopted the principles and code provisions of the Corporate Governance Code as the foundation for its corporate governance practices[98] - The company deviates from Code Provision C.2.1 of the Corporate Governance Code regarding the separation of Chairman and Chief Executive roles, with Mr. Tian Ming holding both positions, which the Board believes benefits business prospects and management unity[98] - The Directors have confirmed strict compliance with the 'Model Code for Securities Transactions by Directors of Listed Issuers' during the reporting period[99] Board Committees The company has established an Audit Committee, a Nomination Committee, and a Remuneration Committee; the Audit Committee has reviewed the interim financial information and discussed accounting policies, financial reporting, and internal controls with management, with no disagreements between the Board and the Audit Committee - The company has established an Audit Committee, a Nomination Committee, and a Remuneration Committee[100][101] - The Audit Committee has reviewed the interim financial information and discussed accounting policies, financial reporting matters, and internal controls with management, with no disagreements between the Board and the Audit Committee regarding accounting treatments[100] Dealings in Listed Securities During the reporting period, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities on the Stock Exchange, and the company held no treasury shares - During the reporting period, neither the company nor any of its subsidiaries purchased, sold, or redeemed any of the company's listed securities on the Stock Exchange[102] - As of June 30, 2025, the company held no treasury shares[102] Use of Proceeds from Global Offering The net proceeds from the global offering were approximately HKD 328.3 million (approximately RMB 293.0 million); as of June 30, 2025, the remaining net proceeds were approximately HKD 74.8 million (approximately RMB 66.9 million) and will be used as stated in the prospectus - The net proceeds from the global offering were approximately HKD 328.3 million (approximately RMB 293.0 million)[103] - As of June 30, 2025, the remaining net proceeds were approximately HKD 74.8 million (approximately RMB 66.9 million)[103] Interim Dividend The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025 - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2025[104] Publication of Interim Results Announcement and Interim Report This interim results announcement and interim report have been published on the Stock Exchange's website and the company's website, and will be dispatched to shareholders in due course - This interim results announcement is published on the Stock Exchange's website www.hkexnews.hk and the company's website www.starcmgroup.com[105](index=105&type=chunk) Definitions This section provides definitions for key terms and abbreviations used in the report, including Board, China, Company, Corporate Governance Code, Directors, Global Offering, HKD, Hong Kong, IFRS, iQIYI, Listing, Listing Rules, Main Board, Mengxiang Qian, Prospectus, RMB, Shaanxi Shuolan, Shaanxi Yuanlv, Shares, Shareholders, Stock Exchange, and USD - Definitions for key terms and abbreviations used in the report are provided[106][107][108]